For potential new investors25 Oct 2018 10:23
For potential new investors thinking of buying BMN but don't know much about vanadium and have noticed the rising price and are wondering about future prices, here is the transcript of yesterday's interview with SP Angel Partner and Mining Analyst John Meyer on Vanadium (24 Oct 2018 Audioboom). The transcript is only for the vanadium section. Other metals were covered.
"Anything else that you're looking at John?"
"Well we can't help but notice that vanadium prices jumped another 17% in China. The price in Europe hasn't moved so much but I think it's because there just hasn't been metal to trade in Europe, so the prices can't react until there's some trading that goes on. The Chinese seem to have stopped exporting a lot of vanadium that they used to export because they are using it all internally with the increase in vanadium that's required for strengthening and hardening rebar.
You can use a bit of niobium in substitution but there isn't much niobium in the world either, and there's one big mine in Brazil that supplies about 80% of the world's niobium. I don't know if that can really ramp up a lot more from where it is. There aren't many other sources of that metal and we think it's quite difficult to substitute vanadium for niobium and only certain steel producers will be able to do it and there'll only be able to do it at certain prices and now the niobium price has spiked it's unlikely to be much of a threat to vanadium and we're struggling to see where additional supplies of vanadium are going to come from.
Now that the Chinese have cast out a lot of the vanadium by product that used to come from smelting poor quality iron ore and magnetite that had a bit of vanadium in it, they switched over to the Australian iron ore which has very little vanadium but is much better quality, higher grade, it's better material for the steel producers and so it's a natural way for them to go. So this byproduct vanadium which was something like 70% of the market is just not there anymore.
And so the world's going to need new vanadium mined, new primary vanadium production and new byproduct vanadium from other sources. But it's going to take a couple of years for this to come in so we're scratching our heads and trying to figure out where prices are going to go at the moment."
From that interview one can conclude that the upward pressures on Vanadium prices through restricted supply and increasing demand seem set to remain for some time to come. And that interview has not even factored in possible vanadium demand from Vanadium Redox Flow Batteries.
It seems that Vametco, 74% owned by BMN and one of only three primary producers outside China, has upgraded from cash cow to cash elephant!
All opinions other than the interview transcript are just mine. DYOR.
Regards. Pdub.
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