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Thanks for that confirmation Alfa

Thanks Alfa.

The leasing model is specifically designed to offset volatile Vanadium prices. Fortune and Mikhail were very aware of the potentially damaging effect of very high V prices on VRFB development. That is why they developed the leasing model with Avalon. Expect to see others developing similar strategies to maintain the forward progress of the VRFB industry.

BMN have positioned themselves perfectly to benefit whatever the V price, either through selling direct to steel industry which at present is looking very profitable and increasingly so, or through energy storage.

As for Niobium substitution it’s price is also high so unless V prices go ballistic like in 2018 I don’t see this as a problem in the near term, and unless I am mistaken niobium is not a substitute for vanadium in flow batteries (Alfa or anyone can you confirm?)

I believe we are beginning to see the result of the excellent strategic planning of FM and MN, who seem to be a step or two ahead of many in the industry. External events (COVID and 2019 V price collapse have slowed things down but with Governments looking at infrastructure projects to lead COVID recovery, increasing demand for steel, greater interest in renewable energy and battery storage to help combat climate change and strong upward pressure on Vanadium price due to increasing demand but slow response on the supply side …. Well we seem to have the ingredients of a perfect storm for those companies well placed to take advantage.

And BMN must be right at the top of that list.

Again just my opinion.

Apologies for omission “…. The market will eventually wake up to this, perhaps even before whoever is selling and/or manipulating the share price has finished. …”

Every $1 rise in V price represents an increase of $1000 per mtV in revenue. At the current price level most costs are already covered so most of that is potentially profit. With annual production forecast in excess of 4000 mtV every $ rise in kgV price produces up to $4,000,000 extra gross profit per year.

The current Vanadium price is increasing by up to $0.5 kgV or more per day. Each of these ‘small’ daily price rises could be adding $2,000,000 or more to annual gross profit. Not bad!

Add to that the improving $ exchange rate against the Rand….. costs are in Rand but sales in US$.

The market will eventually wake up to this, perhaps even before whoever is selling and/or manipulating the share price. At that point I expect to see a significant rerate of the share price.

In the meantime some might describe this as an excellent buying opportunity … but how long before it is gone?

And remember we have seen all this before when the V price rose sharply in 2017/18 and the share price followed it to nearly 50p …. Only now we also own Vanchem and group V production is much higher!

All just my opinion.

Thanks HarChris. That is all I was trying to do.

“… think for yourself.”

LIION my “support” was about the point that Alfa made concerning BMN being focussed on SA (and African continent) as far as direct management of projects is concerned. Nothing more nothing less.

I was trying to help you to understand that they won’t be chasing UK projects by quoting from MN himself, but also making the point that through their partners and clients they plan revenue streams in the wider world by supplying vanadium, electrolyte, etc.

I took the trouble to provide you with a section of transcript from MN. Any decent person would have thanked me for taking the time to do this. Instead of which I get some throw away comment by you which I guess was meant to be some kind of verbal spike.

LLION that was not a pleasant response. That is the last time I will help you.

Piece of advice: don’t believe the cr*p written by our “furry friends”. Read posts carefully and thing for yourself.

“… but I have no idea what you are referring to …”

LIION I apologise for being a bit thick but I have no Leda what you are referring to when you mentioned my name.

Sorry to trouble you but but you explain that point please.

Just to support what Alfa posted this is an extract from an interview with FM and MN on 11.11.2019. MN references the various income streams for BMN and BE and states that they intend to be project operators in South Africa (edit: and I believe elsewhere they have referenced the whole of Africa) but in other parts of the world, including the UK, they are more focussed on partnerships and supplying Vanadium, electrolyte, etc, but not operating the projects.

“MN "In some ways we aren't in direct control. Let's take an example of a project like our minigrid. There we are the developers so we get a development fee when that project closes. We are an investor so we get the return in equity or dividends from the power purchase agreement that is signed to pay for the energy that minigrid produces. By the way we are supplying a battery too so if we want to we charge a mark up on somebody else's battery. If we are invested in that company we get an additional benefit because our investment has now appreciated in value because that company has now got more deployments. We are supplying electrolyte so we get a fee for manufacturing the electrolyte into that project. We mined the vanadium so now we've got a sale on the vanadium. This integration allows us really to capture the value sometimes 4 or 6 different activities on just one single project. Now I want to be honest we are not going to develop every single vanadium project every vanadium battery project in the world but if it's in Africa then it's extremely (attractive?). If it's somewhere in let's say Australia yes we are probably not involved in the development, but we may be supplying vanadium, electrolyte, possibly having equity stake into the company that invested there. Possibly having a stake into the rental product company that is supplying electrolyte for rental. So there's a lot of different ways and it can be extremely active. I don't know who is getting 6 ways to make money on one project. To some there might be only 2 or 3. But in either case it's more than just vanadium and that's what integration allows us to do."

(The sound quality was not good so there may be the odd word error during transcription)

You may well be correct DBB. However I’ll keep an open mind on that.

I believe Duferco holdings RNS on 02.02.21 informed us that they had dropped from 3.12% to 2.95% on 04.01.21. They still held about 35 million shares.

Is it possible that they still have some left and are gradually offloading? I haven’t followed their activity too closely so others may have better info and perhaps they have finished.

I would welcome any specific evidence on this.

Duferco perhaps? They went below 3% so no requirement to report.

Just a thought but the last time Vanadium price was approx $42 kgV the share price was in the range 25 / 30p (April / May 2019). Today less than 16p.

In April 2019 BMN did not own Vanchem. Total group production was 649 mtV in Q1 (similar to the previous Q). In Q1 2021 group production was 688 mtV, despite the 35 day Vametco maintenance closure, so slightly higher than 2019.

Looking ahead at Q2 results BMN must be expecting close to 1000 mtV production (based upon a target for the year of 4000+ mtV). In 2019 production was 742 mtV, they sold just 607 mtV and the average V price was $39.4 kgV. So it would appear that in Q2 2021 group production will be much higher than Q2 2019, as will be sales, and the V price by end of the Q will also be higher.

The share price in 2019, following release of Q2 Update (31 July 2019), was 23p and the V price was $32 and falling. With Vanadium prices higher today and rising, and group production significantly higher it would not be unreasonable to expect a significant upward shift in share price by the time Q2 Update is released.

Obviously production costs and any dilution have to be considered but it all points to BMN being significantly undervalued and with rising V price, revenue and profitability the future is once again looking rather exciting for BMN shareholders.

Of course this is just my opinion. Others may disagree. However the numbers at very least are interesting.

Apologies if there are errors in numbers. I have tried to be as accurate as possible and used RNSs and the Bushveld Perspective as sources.

Exactly pb940. To put those numbers in an RNS the company must be very confident of production numbers to achieve the lower costs.

The info posted here recently suggested the workforce very happy with their production bonus. If true what does that tell us?

I see nothing to be negative about in the BMN big picture, and yes I am aware of the share price today.

However I am also aware that the Vanadium price has been rising for six months, seems set to continue on that path and has moved up faster than I expected. Must be breaking $42 kgV by now.

I am also aware that the shut down was to improve efficiency and ensure greater reliability of production at Vametco, and this should ensure that the BMN plants achieve record group production this year.

I am also aware that the anticipated average production cost at Vametco for 2021 is $20 to $21.3 kgV, much lower that the cost in Q1 due to the shutdown.

What this all means is that BMN is now very profitable and becoming increasingly so.

If some investors wish to be negative under such circumstances that truly is a mystery.

I am suspicious of negative voices suddenly popping up when the future looks so positive.

I am frustrated by the share price, but as I have previously stated I believe we still have one or more entities supplying the market. That supply is finite. Once they have finished the share price movement could be very interesting indeed.

BMN delivered value big time to investors in 2017 AND 2018. I believe it is only a matter of time before that happens again. And perhaps not as much time as some would have you believe.

All just my opinion.

Sorry for your loss Mikinaman.

No amount of good business can make up for that but I know Covid has been tough for you and the business. I hope this new venture succeeds and helps make up for the recent past.

I am sure we all are keen to read about it.

Kind regards. Paul

Great to see the daily Vanadium price rises continuing.

Worth remembering that six months ago European V price was around $25 kgV. Today it is over $40 kgV. Thus those daily % increases in price represent larger actual $ increases. For example six months ago today’s price rise of 2.45% in Europe would have been a rise of $0.61 kgV, whereas today that % rise is an increase of $0.99 kgV. In terms of price per tonne an increase of almost $1000 mtV … and that is just a daily increase!

Following the disappointing Q1 numbers due to the 35 day maintenance shutdown at Vametco there is good news also in that RNS that the market either hasn’t seen, hasn’t understood or has been overpowered by our seller / sellers and / or other activities that may be manipulating the share price.

First, according to the Q1 Update RNS, at Vametco they are working hard to “to enhance and maintain this stability, including maximizing safety and house-keeping initiatives, identifying and solving process system constraints and optimizing preventative maintenance programmes.” In other words to increase the reliability of production and are still targeting annual group production in excess of 4000 mtV for 2021 …. the highest ever group production total!

At the same time they anticipate production costs for 2021 at Vametco to be at “the higher end of its  production cash cost (C1) of between US$20.0/kgV and US$21.30/kgV…” That prediction is significantly lower than the Q1 production cost.

The 100% owned Vanchem plant production is significantly higher than for the same period in 2020. “Production in Q1 2021 of 293 mtV was 34 per cent higher than Q1 2020 (Q1 2020: 219 mtV) and 12 per cent higher than Q4 2020 (Q4 2020: 261 mtV) supported by improved operational stability.” That seems to have been largely forgotten.

So in summary we see the following:

Production increasing.
Production costs lower due to increased volume at Vametco.
Vanadium price already significantly higher (Q1 average $30.9 kgV, today over $40 kgV).
Strengthening US$ - Rand as sales are in $ and costs in Rand.

Conclusion can only be that BMN is now generating significant profit from its Vametco and Vanchem plants, and that if industry expert analysis is to be believed the Vanadium price is set to rise still further during 2021 and therefore the company will become even more profitable.

At some point surely even the most risk averse of investors must see the investment potential of BMN. Just look at the numbers. However that is only my opinion, as is this entire post, albeit based upon my interpretation of available facts.

I don’t do specific share price predictions but once the sellers are cleared and or demand overwhelms the various suspected manipulations of the share price then there is the potential for a very serious rerate. Could that match or exceed the spectacular rises of 2017 and 2018? I don’t know …. But I can’t see any reason why not.

Or this if LSE allow:

https://www.investormeetcompany.com/register

Link was deleted.

info@investormeetcompany.com