Member Info for TigerByTheTail

For me, it's just another example of Unlucky Mine Syndrome.
Why do bad things always seem to happen to Hummingbird and not so much to other miners? You can argue it's just bad luck - a random series of unlucky occurrences. But I think it's ultimately down to bad management.
Today's drop is simply a self-inflicted wound. If they had bothered to explain what this was all about, then the share price wouldn't have reacted so badly. But the truth is management doesn't give a damn about HUM's shareholders. And, as a direct consequence, the share price is at the same level now as it was when the mine was just a pipe dream and gold was $600 cheaper, and no dividends have been paid, either. Management make money out of this company, Coris Bank makes money out of this company, I'd guess local officials in Mali do pretty well too, but for shareholders - zip, zilch, zero.

RNS = Deal breaking down at last moment?
At the least, if they didn't want people to think that, they should have included more detail. (Though allowance should be made for Hummingbird's lousy PR instincts).

My posts at the weekend looking pretty silly now - rhodium down a lot according to Kitco. It will be interesting to see what prices JMAT give tomorrow morning. I never quite trust the Kitco numbers.
I still don't believe that the rhodium price will crash all the way back down to earth. IMO there is still too much demand and too little supply, so this drop should stop soon. I hope I'm right about that!

Hi Bertie!
If you had something to say that could move the markets, you'd normally put out an AGM statement RNS a few hours in advance.
That said, things have been known to slip out inadvertently during AGMs...

Hi Panderman!
I'd make EUA to be a fairly "safe" short. I don't think there will be an asset sale, and if there is, it will severely disappoint. The company's assets are nothing special and not worth anything like the figures thrown around on this board. Getting $50m for Monchetundra, for instance, would be a really, really good deal out there in the real world, but I expect it would me with bitter disappointment by investors here.
The question I'd ask re:shorting is about timing. The end point is clear - EUA is worth only a fraction of its current mcap. But it could take a year or more for that realisation to sink in amongst its poorly-researched and fanatical investors.
So, shorting EUA is likely "safe", but probably a long haul and unexciting.

Just to add, and the money already made has been made.
We've now had five months of super-high rhodium prices. The bonanza profits generated from that mean that this year's ambitious capex program has easily been funded internally, and that Tharisa is now net debt free.
Tharisa will benefit for decades to come from the super-cheap chrome that the new Vulcan plant will turn out - around 0.4Mt per year of it.

Article feels a little confused - not sure the journalist really got the message.

Hi Shanny!
You have got to be joking with that post!
This is the most embarrassingly debt-free and cash-rich business I think I've ever seen. In fact, I'd go as far as to say that what to do with all the cash they have in the bank is SLP's biggest problem. Which, as problems go, is a high class problem to have.

Hi Stoodio!
I actually looked into buying some rhodium metal rounds when the price hit $3,500, because I was convinced it would go to $10,000. But the 50% bid/ask spread put me off. A dumb play that.
Then, to compound the error, I looked into buying iridium rounds when that was at $1,500. But again the huge spread put me off.
All in all, it would be worth back-engineering both the current SLP and the Tharisa share prices, to see at what rhodium price they would trading at "fair value". Both share prices massively undervalue the companies with rhodium trading at $28,000/oz or so. I'd guess that the market (inasmuch as it isn't simply asleep) is pricing in a long term rhodium price of - maybe - $4,000 / oz.
And I think time will show that assumption to be hopelessly pessimistic.

Yep. Good results. They should add ups to quite a few easily mineable and profitable ounces.

No, Naise.
Some shares go up over a long period. For instance, look at the price action of the excellently managed highly profitable SLP over the last five years. Almost regardless of when you invested, you would have made money on that stock.
And some shares simply go down over a long period because the business behind them is poorly managed and failing. I'd suggest that Vast is now one of these shares. And therefore it is one to avoid. You'd need to be incredibly lucky to trade this stock successfully now.

Hi Raxfactor!
Prill splits are quite different between different miners. It depends very much on the deposit being mined - in the Bushveld there are three main sources of ore - the Merensky reef, the Platreef, and the UG2. Additionally, there are major PGM deposits in Russia, Zimbabwe (the Great Dyke), and Canada. Of these, the UG2 reef (which THS and SLP are working) is by far the richest in rhodium (and also iridium and ruthenium). The rhodium content can be up to 10% in the UG2, whereas it is half that or less in other South African PGM deposits, and even less in the Russian, Zimbabwean and Canadian resources. If you go to the latest Heraeus report, there is a good article on precisely this.
But yes, it is hard for the PGM miners to increase rhodium supply by very much in the short term. Some of the majors do have plans to expand production by reopening old shafts etc., but these ounces will take years to come online.
As for substitution, I know that (palladium dominant miner) Sibanye have touted this theoretically, but I haven't seen much evidence of it in real world terms. Amplats spend quite a lot of money on developing new blue sky technologies which involve the use of PGMs (e.g. using it as the cathode in lithium batteries), but I'm not aware of them being involved in any attempt to substitute out rhodium in catalytic converters.
My outtake is the Seeking Alpha article is way off the mark because the writer confuses the popping of a speculative investment bubble with a genuine, persistent, chronic deficit caused by undersupply and (legally mandated) over demand. As far as I know, nobody is hoarding rhodium or trying to put "a corner" on the market, as the Hunt Brothers famously tried and failed to do with silver in the 1970s. There is no above the ground supply being kept in a bank vault which will suddenly be released onto the market as the result of a disastrous margin call. Of course the rhodium price will drift up and down, but (IMO) this definitely ain't a bubble - it won't suddenly go pop.

Only in a "Brewster's Millions" sort of way.
This company has destroyed tens of millions of pounds of PI savings, and there is no sign that is going to change anytime soon.

The placing has most likely been flipped and pre-sold back into the market at above 26.5p. Don't you even understand that?!?
In effect, the "American institutional investor" (i.e. some broker) has received an almost instant return of around 5% and warrants for free. That is their upside here. You really should NOT be investing in AIM if you don't understand its cynical and money-grubbing ways.
Yes, I value this stock at around 5p. Though I think it will take a year or more for disillusion to set in and for the share price to drop back to that level. The quasi religious fervour on this board is strong.

Hi Ducter!
You should also consider that there are those of us who consider that these shares are wildly overpriced, and that their true value is nearer, say, 5p.
If you have money at stake, it's worth doing in depth research on other PGM miners and their valuations. One thing is crystal clear - either almost all other PGM miners / developers / explorers are grossly undervalued, or Eurasia is grossly overvalued. Take your pick which one of these statements is true.
Oh, and since somebody mentioned GGP, I note that its share price is slowly falling back to earth as people very slowly realise that a 25% share of a smallish and deep gold deposit (even in Australia) isn't worth all that much. It's another example of how AIM can get natural resource stock valuations hopelessly wrong sometimes. Still, GGP is very much a "sell" at 20p, though. There's still a long way to go down there.

One of the major errors in the article (there are several) is that the writer assumes that rhodium will be replaced by palladium in three-way catalytic converters, and thus demand will drop.
This idea has been promoted by Sibanye Stillwater (since they are major palladium producers).
As far as I can tell:
1. Rhodium is required in three-way cats to reduce NOx gases. Currently, palladium is used in gasoline engines to catalyse two entirely different reactions - the conversion of carbon monoxide to carbon dioxide, and the combustion of any remaining hydrocarabons.
2. Theoretically, palladium can be used to reduce toxic Nox gases, but this requires ideal conditions and it has low efficiencies. It also requires a lot of palladium - I've seen from 5-10 times as much palladium as rhodium is required for the same catalytic effect.
3. No such palladium-only three-way catalytic converter is on the market or has passed any of the stringent regulatory tests required. At best, we're talking about an early prototype several years from being installed in a new car model.
4. Since palladium is also in deficit and costs around $3,000 / oz, using a minimum 5 /oz of Pd to 1 / oz of rhodium would imply a "floor" price for rhodium of $15,000 / oz anyway.
If anybody knows more about this (I'm only an amateur) or can correct any mistakes I've made, please post here. I'd be very grateful to learn!

Just to add, it's worth ploughing through the comments on the Seeking Alpha article as well, which I'v just done.
The commentators there know far more about PGMs and Stillwater than the hapless author of the article.

Hi Sotolo!
And I think the article is poorly researched, amateurish, and flat-out wrong. (As is usual for articles by this particular writer, by the way).
Note how, for example, the far more authoritative recent Heraeus report estimates that the rhodium price will average $29,000 for the next six months, and that "the risk is to the upside".
I make the minor rhodium price weakness of the last few days down to two factors:
1. The official statement of concern by China about rising commodity prices - this seems to have scared the market somewhat and it has resulted in most base / industrial metals dipping in price.
2. The return to full production of Nornickel's Oktyabrsky nickel-palladium mine in the Arctic, after the flooding earlier this year. (The other flooded mine - Taimursky - is still being pumped out, but it should come back online as well in a few weeks).
FWIW, I still have my doubts about the long term viability of the mines, but for now they are working.
There is no magical supply of rhodium to come online and to resolve the long term deficit of the metal. Almost all above ground stocks have been depleted. And those who can eliminate rhodium from their industrial processes (i.e. glassmakers) have already done so. So, IMO, until either world car and truck production crashes due to a world economic crash, or until full battery electric vehicles take a much more sizeable chunk of the market (and there are lots of reasons why that will take years), then rhodium will continue to be in severe deficit, and therefore its price will remain high.

One article from 2019, the other from a year ago.
Yeah, Shareminator, that's the top notch kind of research I've come to expect from you. Thick as...

Vast is almost certainly losing money at Baita Plai right now (look at the tiny production numbers).
Vast has not proved that Baita Plai can ever make money - even on a mine operating level, without considering capex, other projects, and general and administrative expenditures.
Vast has only limited cash reserves. It can't go on like this for very long.
The Atlas death spiral loan means that is very hard for Vast to issue shares and raise money on the open market. So that way out is all but closed off.
It's also hard for Vast to raise new debt finance given the BOD's history, the lack of performance of Baita Plai, and the existence of the Atlas loan.
If nothing changes quickly, then yes, something will break and Vast will go bust.
It's a quite normal outcome for a company in this situation, you know.