RE: Largo and Glencore29 Jun 2019 09:41
They are using the money to build production and a sales team. Ask yourself why would you need a sales team if you were going to continue your offtake agreement, where all your sales are managed for you. You wouldn't unless you were about to embark upon your own.
If a company was about to lose its comfortable stranglehold on global production they probably would not be best pleased and would certainly be looking at increasing the pressure or buying another co in a low price environment. The opacity of the vanadium market provides great cover for price control.
BMN being one of the lowest cost producers in the world, with no debt, is watching and weathering all of this, making good profits and quietly going about the business of building itself into the biggest vertically integrated vanadium producer in the world, regardless of any market distortions.
I know there is some concern about ongoing lower V prices and the share price, but remember the market makers and nefarious forces around them, such as our shorting visitors are like wolves hunting out temporary weakness. Anyone who has run a substantive business knows there are good times and more challenging ones and the strength of your company is seen when the pressure is on. Well the pressure is on the V market and we are showing our strength. We are still eminently profitable, growing and making acquisitions. Vametco, Sojitz and Vanchem, all cornerstone deals that have been done at a point with lower V prices. That is the boldness we need. And if we can ice the cake by affording to buy back shares without harming the funding for our ventures then I would fully support that.
The big picture for BMN with Brits, Mokopane, Vametco, Vanchem and the electrolyte factory and VRFB project operations, is exceptional. The key for shareholders is not to be disheartened by short term action, not to be dissuaded and parted from their shares at a distorted price and to keep focused on what is a brilliant story, a commodity that will only increase in demand and a company that is a substantial stakeholder in an energy transition that is really only just beginning. Our insulation against low prices is strong and growing with the development of BE and the electrolyte supply agreements coming will prove that.
Have a good weekend all and think about those poor flammable lithium batteries and the amount of cooling they are going to need this heatwave-infused weekend, just to stop themselves catching fire and self-immolating.
The future for long duration storage is vanadium. Lithium is just not up to that specific task. The wide ranging needs of the energy transition cannot be solved by a singular storage technology and BMN know that and are making sure they are best placed to answer the impending call for safe and stable, 24 hour, renewable driven power grids as well as supporting a growing steel sector demanding higher strength products.
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