Member Info for SickOfTheRatRace

Well I am sure if a PI attempted to bang in 4m of repeated 500,000 sells in quick succession the NT wall would go up pretty quickly assuming you could even sell the first tranche. However as they were prepared to take 1m this morning we could make allowances for a couple going through but very unlikely 8 would. So is this direct market access?

Absolutely. Also that new supply that the market is so desperate for won't be appearing as the projects will not be economical. It's already doubtful if some announced projects could progress even at this price so that will just keep the deficit in place for even longer. It's a wonderful position to be in that Bushveld Energy the VRFB supplier won't have any difficulty obtaining Vanadium from Bushveld Minerals the Vanadium miner unlike the vast majority of VRFB projects which will be relying on buying from the "market".

I see a number of similarities with oil, as the known reserves become more and more costly to extract the market price has to follow otherwise eventually the taps run dry. There is a definite and necessary equilibrium between producers and buyers. Not to say that Vanadium is in exactly the same position given the decades of reserves available to BMN, but having just one or two suppliers controlling the market isn't desirable. Even as a BMN shareholder I don't think being a virtual monopoly would be helpful to anyone but lower prices would be very beneficial to our expansion plans as suddenly your acquisitions team is surrounded by fire sale opportunities.

The time corresponds with the crash down to 23p at 11am so would appear to be sells, but what do I know. If it is the final tranche of some entity disposing then good riddance.

Absolutely pdub. I have no doubt that even $50kgV was beyond the wildest dreams of BMN when they acquired Vametco so I am not really sure what all the fuss is about at $35. Anyone would think we were skint the way some posters are carrying on. The annual report released by the end of next month will show the true story.

I am sure you will know all about it when they knock on your door!

If a surplus was theoretically hit and the price fell to historic lows it certainly won't be BMN going bust as we are lowest cost. Would mean VRFB's would be flying out the door faster than we could build them though so it's win win for us.

calamari you are entitled to your own view but mine is based on the whole:

" If you take today's price now at 23p the drop is 38%. In the same time period V prices in Europe have dropped 9% and in China 16%, clearly NO correlation between our SP drop and the V price drop.... if the SP had taken the same pattern as V we would be around 27 - 29p"

BMN drop = 38%. V drop Europe 9%. China 16%. There is clearly NO correlation between a drop of 38% and either 9 or 16%. Particularly as we ship to the USA where the last information we had was that prices were holding firmer than Europe or China.

calamari I believe I said all I needed to say on the matter in the post you part quoted.

calamari you cherry picked one comment out of a paragraph and used it out of context to the point Raz10 was making was that the BMN price is being forced down more than Vanadium prices can justify.

"On the 2nd May at the short peak of the Vanchem announcement the SP closed close to 31.75p. If you take today's price now at 23p the drop is 38%. In the same time period V prices in Europe have dropped 9% and in China 16%, clearly NO correlation between our SP drop and the V price drop.... if the SP had taken the same pattern as V we would be around 27 - 29p.. Clear and simple Manipulation"

Agreed it is a predictor based on hindsight. It doesn't change it's opinion unless it has traded the opposite to the current view for two trading days.

PennyPusher unfortunately from my perspective it doesn't counter the argument. For your simplistic calculation to have merit it would have to assume that the only factor in the rise was the Vanadium price and all other company fundamentals remained the same.

The calculation takes no fundamentals into account the most important of which was the company going from a minority holding in Vametco to being the majority owner.

Secondly it also doesn't allow for any "catch up" that was going on. After all just about every calculation posted during that time showed that purely on Vametco were were undervalued by between 2 - 4 times if we take your 40p end as the figure. In fact I cannot remember a single calculation being posted at any point in that two year period that didn't have a conclusion showing we were hugely undervalued.

The fact is that BMN has always been undervalued but as someone commented recently we are certainly not in the minority believing that as far as the AIM market is concerned.

The Vanadium demands now are somewhat different to those previous spikes. The huge demand for V to satisfy the Dalian battery for one (quoted as "the worlds largest battery"). There were no VRFB projects of scale during previous movements.

No-one predicted this fall because it is a fall that doesn't correspond with the facts as they were known.

One of the primary issues is that there is no recognised trading market for Vanadium that people can follow trades and prices. The limited information there is relies on disclosure or private sleuthing. I could turn up at Vametco tomorrow to collect 100 tonnes and no-one outside the facility would know the trade occurred as there is no requirement to disclose it to any market. The first you would know about it would be on a quarterly production/sales report and only then consolidated into general figures.

All the facts (at least as they existed at that time) were that the market was in structural deficit. That seems to remain the majority view. If there is more demand for a product than there is supply then the price goes up or at least stays high, at least if the normal rules of supply and demand are being followed.

The new information coming through now is that it seems there was stockpiling going on at the end of 2018. That stockpiling no doubt being caused by increasing prices and concerns about being shut down if they didn't have enough supply to comply with the rebar standard. This rise then became self fulfilling as mills continued to source supply. Once stockpiled to a managerial led comfort level, they stopped buying, price has gone down since.

It seems clear nobody knows for sure the extent of said stockpiles but they cannot last forever. If as Terry has said China is in a period of record rebar production and Vanadium is being added as expected then eventually that stockpile has to reduce and demand returns. The question is how big those stockpiles are and then again it comes back to the lack of trading information being available to predict this with any accuracy - nobody here has any clue as to how much any particular mill bought at any particular time or how much they have left.

However personally I think there is more to this situation than meets the eye. The fall is too far and too quick it would seem there are additional parties trying to take advantage of this. Whether this has anything do to with a particular supplier coming to the end of their exclusivity period I will let you be the judge.

Well we certainly didn't rise faster than the commodity. You can take your valuation calculation of choice (multiple PI's, brokers) and all were over 80p, the majority over £1 just for Vametco. We didn't even make a 50p close on the commodity rise.

No doubt when Vanadium goes back to $100 a kilo we can have the discussion again about BMN following prices because we will probably still be at 25p with people coming up with every convenient excuse under the sun.

Vauch I believe when this was looked at before a dual listing is only possible if we are on SETS.

We should be concentrating on USA prices not China as the majority of our product is sent to the USA.

The new import taxes between China and USA in their escalating trade war also mean there is little point them buying from each other when they have a source such as BMN that is not subject to these taxes.

Very interesting conversation the Largo board are having, I wonder if BMN are currently debating similarly?

"Bryce Adams

My last question would relate to the capital return program. I know that details are coming out in the next month, but just with where the shares are trading at the minute in the $1.70 sort of range, $1.75, $1.80, would you give any more towards buybacks rather than dividends in that scenario?

Mark Smith

Yes. Let me answer it by saying it's, I'm sure, this question is going to be asked with some additional people on the phone here. But we are looking at everything possible at the Board level, but I think the general rules always apply, and that is that if the share price is low, that's what we are to be doing is repurchasing shares.

If the share price is high, we should be issuing dividends. So, we've got to continue to take a hard look at the business environment, the market cap of the
company and make the best decision we can going forward.

The other issues that we look at which are additional variables that may be a little bit more specific to Largo is that we want to be very careful about potentially impacting any of the liquidity that we've created in the company over the last six to eight months.

So, we're trying to balance all of those things, but the Board is committed to making that final decision, and we will issue a press release on that on or before the Annual General Meeting on June 27th."

Also working to the same timescales for the dividend policy as BMN.

Something to watch from both sides given the similarities.

"I do have a price outlook for 2020. I think that in 2019, we're going to see a lot of turbulence. We're going to see some tremendous changes in terms of consumption. The high prices that, that should drive in 2019 will have some impact on supply as well, in China, in particular. My vision, frankly, is that we're going to see prices in 2019 and 2020 much higher than what we saw in 2018."

pdub just to add my thanks for the transcript, a very useful read during my lunch today.

I believe shareholder permission for BMN to repurchase shares is still in place from several years ago or was there a time limit on it?