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REeeTech, we may have a common line of thought here. there is a consensus from various parts of the ex China industry that RE prices are going the way that uranium has recently. Despite the recent hiccup, almost all market analysis, including Adamas, and Markets and Markets (published May 2024, ie just now) with a base line 0f 2023, are forecasting a 12.6% CAGR until 2030, assuming a base of $60,000/mT for NdPr Oxide, that's $150,000 in 2030. An extract of the report found here. (im not spending $4000 on the full report although i would love to read it) https://www.marketsandmarkets.com/Market-Reports/rare-earth-metals-market-121495310.html?gad_source=1&gclid=Cj0KCQjw_-GxBhC1ARIsADGgDjv96Lx_Frc8vHyBepSxKqVAzQ0Man_caoLcGLj3uX8ZGNr8P4MbJ5gaAjANEALw_wcB
ReeTech this is a classic example of posting out of context. If the article in the Wall Street Journal is read, it gives a history lesson about how the Chinese came to dominate the Rare Earth Industry, including the quotation "I built my own gallows", by Michell Spencer. He said this in 1998, 26 years ago. The context of the current discussion is how the situation needs to be reversed if security issues are to be avoided, and that it isn't an easy task. BUT THAT IT HAS TO BE DONE.
Through choice Lewis......
ReeTech and all RE companies, including Chinese companies, experienced depressed earnings in Q1 this year due to the depressed price, which dropped below 50K/MT. As of Tuesday this week, the NdPr price is the highest it has been since 10 January. It will be interesting to see where it is on Monday after the May Day break.
Have received confirmation that the loan note extension has been granted. no further details were given, and it will not be published. Not being hidden, the question was asked, and an answer was received. I'm sure if anyone else feels like contacting the company directly, the same answer would be given.
REETECH, That's old news; you know that the price dropped dramatically from the beginning of the Year, having varied from 56,000 on Jan 8th down to 49K in the middle of May. Compared to the quota, China had a surplus of over 6,000 mts last; this year, they are expecting a deficit of slightly less than 1,000 MTs. consequently, the NdPr price has increased to the highest it has been since the beginning of the year. it seems that the magnet manufacturers are stockpiling now as they don't expect the prices to drop less than they are paying now but rather to increase.
Cheap option, you've got to be in it to win it, and this cost less than 15mts of copper at today's prices, with plenty of price upside expected. Obviously very little is know on the CAPEX, OPEX or expected Ciu recovery, but that's the point of rhe extended DD period. 12 months is a significant time period for exclusivity.
Ndpr prices:, and up every week for the last 5 weeks. Might find this interesting https://www.adamasintel.com/wp-content/uploads/2024/04/Adamas-Intelligence-and-Tradium-EU-CRMA_Opportunities-Challenges-Viability-and-Next-Steps-April-2023.pdf
I did raise a question, "If Saltend has a processing of capacity of 40,000 MTs p.a., from which 12,500 of separated Rare earths are obtained. what happens to the balance, 27,500 MT's, does it go to landfill?"
Answer; "it ispredomnantly Gypsum for which their is a market". not a huge income but another revenue stream, inaddition to the lanthanum and Cerium. Together, they will probably pay Saltends wages, and have to be disposed of anyway.
Hi lewis, it should be clear that the 15 million "Bridging loan" is part of the fiancing structure Longonjo, belongs to Ozango limited and is not accessible to PRE. As at Dec 31, 4 million was already spent as you say, as of 27th March 7.5 million is spent. Since last years unfortunate interims. they have raised $10,000, plus received $1,500,000 of tax credits, (which i referred to as 2 million, and was questioned on my honesty previously). So $11.5 million, and had some debts to cover from that.
Other than that I agree with most of every thing you say. As far as i am aware, costs external to Longonjo are on close to a care and maintainace basis, except where PRE also has obligations to the Angolans and Longonjo, as per the existing contract all product ex Longonjo is obligated to PRE, and they are responsbile for markting the product, also some funds are need where PRE have work programs to comply with license obligations for the Coola and Sulima licenses and also to keep the Saltend part of the project warm. i woudnt think these are too high in the big picture. Obvious salaries need to be paid,
DP/SP, I fully support your statement on this
I should also add that loans by South African banks also qualify under the ECIC mandate not just goods, as does finance from other AFRICAN countries. However, South African content requires a minimum of 50%; overall, African content is greater than 70%. https://www.ecic.co.za/products/export-credit-insurance/
Absolutely know I have figured it correctly Theo. And you have answered your own question within your post
Excellent article
ReeTech, the question is, How long will they keep up increasing supply to exceed demand. There is no point in squandering your resources in the long term. Even a slight over supply has a devastating effect on the achievable price, as the price of future supplies take the price of the last ton sold, until such time as the supply/demand balance changes.
One thing the Chinese are not is stupid. If you were them, would you exhaust tour own supplies at 1/2 or less that from a achievable price of a carefully managed extraction as a long term policy. Then be at the mercy of the external supplies to maintain your own industry.
The Export Credit Agency is the South African company ECIC. If a project's value is 70% or more African content. And at least 50% of South African, political and/or commercial risks can be insured against. This can reduce interest rates considerably on project finance.
https://www.ecic.co.za.
Never assume anything, it makes an ASS out of U and ME
Tony, the 220 million includes 20 million contingency, which hasn't been included in the cash spend forecast.
Lewis, it was £2.07, still a huge drop. i also think touting a 50% increase from a month ago is disingenuous. What I will say is that the structure seems to have turned from a sustained depression in the SP over time, to a seeming increase in it
The guidance given in the RNS is Q1 2024, although there were aspirations for Indaba conference. Which unfortunately didt come off