The relationship between the US equity markets and gold
With the US equity markets continuing to set all time highs we are seeing gold suffer. Chris and Doc join us to discuss why a rising market at all time highs hurts gold. There are a number of headwinds for gold but let’s all keep in mind we have seen a recent nice move in the metal and related stocks. Now looks like a time where the metal will continue its move down and become a buying opportunity for investors.
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Seems EVERYONE is now bullish general equities.
I have not seen such consensus since the top in 2007, and the recent top last summer.
Why worry? Fed has your back. Usually when everyone is bullish, no one is left to buy.
Will this time be different? Are we living in a new era?
At the recent lows, everyone was bearish.
hmm
Vix is flirting with the yearly low. Bullish consensus very high.
This is the type of market where we move lower, not higher.
Since brexit did not cause any major market upheaval, the coast looks clear.
We made it past brexit, clear blue skies ahead.
Everyone is thinking the same.
When everyone is thinking the same way, someone is not thinking.
I would be extremely careful here.
I think the EU referendum in the UK was a tempest in a teapot and meant to continue conservative power in parliament.
So why exactly did Cameron resign…..you seriously think that was his intention from the outset, because I don’t.
Besides how could Cameron know that Corbyn would mutilated by an Eagle.
By the way, the media(especially the BBC) got it very wrong about Brexit.
http://blogs.spectator.co.uk/2016/07/new-poll-finds-twice-many-young-people-voted-eu-referendum-previously-thought/
That has been the outcome so far.
Where do you get that info from, Dave? I’ve seen a much different picture, not the least part of which this morning’s news of near-record high cash holdings on the part of retail investors. And even where institutions are concerned (perhaps changing a bit now) they have been net sellers of equities in 2016, and have been more heavily buying P.M.’s and ETF’s. Even on Tout-TV there has been more optimism over gold’s rise than the breakout now for stocks, which still is viewed with considerable skepticism.
I agree to some extent with your analysis, Chris.
But I see hedge fund money STAYING in Mining, but ROTATING to base metals right now.
e.g. Look at VALE, FCX (both up 10% today), even other copper stocks like WRN, or FQVLF are not down today.
YES, the wind is at the back of regular stocks right now, with another round of collusion between the Central Banks, so general stocks will overshoot to the upside.
But here again rotation into higher dividend stocks is apparent.
What I do not believe QE can always do is to permanently prop up a general stock market in the face of increasingly apparent detiorating economics. Only direct government buying of stocks can accomplish that.
Perhaps that can happen in the US for a while, but they are already printing money to over-value bonds and keep interest rates low. Can the Government get away with buying bonds AND stocks?
Interesting CFS – you think that base metal miners are going to get a run here?
I don’t know!
I don’t know because I believe almost everything is overvalued right now.
Can base metals outperform precious metals?
Hindsight says they have since the 4th of July weekend. (And I did start talking about them a few days ago)
But when the market sentiment is high, I get scared to death, looking to sell or short, not buy.
I’m not going to sell general stocks against the prevailing wind at our backs caused by excessive money printing, but I’m mentally thinking where do I put in trailing stops.
Or where should I buy some “put” insurance.
I am probably going to buy a bunch of FTSE listed miners tomorrow morning as I think Carney is determined to lower the BOE base rate on Thursday.
I think that will give a big spurt to the FTSE listed miners. Ah, but what about gold and silver – will the rate decrease be seen as a BREXIT thing or a sign of wider interest rate cuts to come in other countries.
Do you think Carney will act before a new Chancellor of the Exchequer is chosen by May?
I’m not sure he will.
May probably will announce most of her cabinet this week, though.
Probably Osbourne will stay.
Yes.
I increased my position in NSU @ $2.80 for a 5.71 % yield, a base metal miner with Au/Au and now proud owner of Reservoir
You did well to get in below $3. Could be a doubler. Could go down first though. You have a nice cushion.
….a darn good merger between Nevsun and Reservoir. Well done!
Nevsun Resources faces lawsuit over ‘forced labour’ in Eritrea – The …
http://www.theglobeandmail.com › Report on Business
Nov 20, 2014 – Nevsun Resources Ltd., which owns a large copper mine in repressive Eritrea, is facing a lawsuit in Canada alleging the company was …
Nevsun is one I wont touch, slave labour is not something I support, I wont touch shrimp from s.e. asia either.
There are enuff options for investing, stuff like that isnt required, just me I guess, I dont invest in weapons etc. lotsa profit around if ya dont really consider the cost for people.
Wow – thanks B. That is one off my list.
That is old and inaccurate news B. Nevsun publicly addressed that they never enforced slave labor in any aspect of their operations, and that the media an few soliders made a big media spectacle to publicly attack the mine and Eritrea. A 3rd party contractor responsible for the government’s contribution had hired soliders at one point in a construction project, and Nevsun didn’t endorse or have any say in this. The a news person with an axe to grind hyped the story of 2 of the soliders that had more complaints about the military in Eritrea than the mine. It was a very opinionated piece at the time, and the management has addressed this multiple times now over the last few years.
Consider the fact that their Bisha mine has brought more infrastructure, skilled jobs, education & training, medical supplies, and a better quality of life to the people of communities near their mine, and through the government earn in to people all over Eritrea. Someone had to take the first step and get larger resource projects going in a country that has had a terrible past and has frightful government infractions. Consider the situation that existed before the mine was there, and ask yourself if they’ve done more good or bad for that community. It’s a 2 way street of course….
As far as I could tell Bob, it was just their mine in Eritria, its a dictatership there I guess.
The other mines were ok.
But for me, I dont care, I wont touch them.
As far as Im concerned the canadian gov should have been looking into it long ago, and shut them down in canada and jailed all concerned on principle.
Not the way the world works tho.
Nevsun
Governance and CSR Management
Oversight of Corporate Social Responsibility Practices
Enterprise Risk Management
Anti-Bribery and Anti-Corruption
Commitments to External Initiatives
Human Rights
Stakeholder Engagement
We continually refine our activities to meet the highest ethical standards, including the proper treatment of all stakeholders associated with our operations and will persist in updating our policies and procedures to reflect this commitment.
Nevsun integrates the respect for human rights into its Code of Ethics, its operational policies and procedures, and in its operations. Our approach to human rights is evolving and ongoing and we are committed to international principles and guidance, as well as integrating the recommendations from our recently completed Human Rights Impact Assessment (HRIA).
hardhatAll of our recruitment procedures conform with Eritrean Law. As such the BMSC Human Resources and Employment Plan (the “HRE Plan”) has policies and procedures in place to protect against underage workers at its operations and only employs persons that are 18 years of age and older. Additionally, a formal identification card, a prerequisite for employment at the Bisha Mine, can only be granted once an Eritrean citizen reaches the age of 18.
Specific to our Bisha operation, and in accordance with Eritrean Law, the HRE Plan also mandates that all applicants hired must demonstrate that they have been cleared from the Eritrean National Service Program. Both our contractors and subcontractors are in compliance with this documentation process, which is audited on a regular basis.
A small number of Government of Eritrea and student demobilized workers are given the opportunity each year to take on a secondment at the Bisha Mine. This provides an opportunity for them to acquire real world operator experience in the mining sector and to work for a private organization at a much higher rate of pay over a period of six months before returning back to their regular employer. Those electing to select this option must freely sign-off on their willingness to join our workforce at their choosing for a specified period of time.
***During 2014, we did not receive any formal human rights grievances or identify any issues of non-compliance in respect to the use of national conscripts.
A lawsuit was filed against Nevsun in November 2014 in the B.C. Supreme Court by three individuals who claim to have once worked with a local subcontractor at the Bisha Mine. The lawsuit makes human rights allegations against Nevsun and its local subcontractor. Nevsun denies the allegations and will vigorously defend itself against the claim.
The security standard at Nevsun’s operation is designed to assess risks and protect the Company’s people and assets in a manner which minimizes conflict and respects the human rights of its stakeholders. We ensure our security is managed in a way that respects and protects human rights, avoids creating and or escalating conflict, and addresses security threats in as peaceful a way as possible. Our security services are provided by a local Eritrean contractor and 100% of its employees are required to receive regular training in security protocols and procedures, which includes aspects of human rights including harassment, discrimination, and cultural awareness. We have adopted the Voluntary Principles on Security and Human Rights and implemented numerous policies to ensure all employees, contractors, and subcontractors are treated with dignity and respect at all times. In conjunction with the HRIA, Nevsun has embarked on a program to ensure its security contractor and relevant BMSC managers will meet on an annual basis to discuss the Company’s obligations with respect to the Voluntary Principles on Security and Human Rights.
If you both to get the whole story, and do a little due diligence, you’d discover that Nevsun (because of the media spectacles and law suit) is way more focused on human rights than many of their peers in Africa, and really in mining and business worldwide. It is a constant effort and priority if you spend anytime listening to the management at conferences, or if you watch how things have improved for many living in Eritrea as a result, or if you watch the videos of the thousands of happy workers that are grateful the mine is there.
It’s easy to cast stones when you don’t let the facts get in the way….
______________________________________________________________________
The Bisha Mine Human Rights Impact Assessment
In mid-2013/early 2014, Nevsun commissioned its first independent HRIA at its Bisha Mine to better understand strengths and identify areas where human rights best practices can be embedded in Eritrea and wherever it operates. To implement the HRIA, an independent international human rights lawyer undertook two field missions to Eritrea (October 2013 and January 2014) to gather information, review documentation, and visit the Bisha Mine. The assessment team conducted interviews and focus groups with a wide range of stakeholders, including Nevsun and ENAMCO’s senior management; Eritrean government officials; BMSC employees and managers; local community leaders; and employees and managers of Eritrean contractors, subcontractors, and suppliers.
A broad and comprehensive mandate was given for the HRIA to examine the full spectrum of human and labour rights through a review of the policies and management systems in place at the Bisha Mine and engagement with stakeholders in Eritrea. Specifically, Nevsun wished to better understand where there may be risks, associated with their operations, of human rights impacts on workers and local communities.
The HRIA prioritized the following:
Labour rights, including freedom from forced labour, freedom of association, working conditions, and training opportunities
Human rights related to the environment, including the human right to water and sanitation
Community development and stakeholder engagement with local communities
Security and human rights
Human rights due diligence with respect to business partners and supply chain
Grievance mechanisms at the operational level
The recommendations to support ongoing due diligence for human rights at the Bisha Mine resulting from the assessment include:
Adopting and embedding a more explicit human rights policy
Conducting further human rights training at Bisha
Integrating human rights considerations into the
implementation of the 2012 IFC Performance Standards at the Bisha Mine
Engaging on human rights with suppliers, contractors, and subcontractors
Developing a framework and protocols to ensure the effective implementation and coordination of all grievance mechanisms
Continuing discussions surrounding the implementation of the Community Assistance Programme (CAP)
Upon completion of the HRIA, Nevsun published and made publicly available a summary of the report, and also committed to providing a public response to the HRIA, developing and sharing an action plan resulting from the HRIA process, and continuing to report on human rights in its annual CSR Report. In 2014, Nevsun representatives met in person with interested stakeholder groups to review the full report, its recommendations, and planned Company follow-up.
Nevsun has received constructive feedback regarding the commitment to the principles of accountability and transparency, and that our actions to date have represented good practice in the emerging field of impact assessment related to human rights.
Human rights are integral to Nevsun’s corporate values and shape the expectations of many of its stakeholders. Most importantly, human rights are fundamental to the ongoing dignity, safety, and well-being of the individuals and groups that are affected by the Company’s operations. For our commitment regarding the continued implementation of human rights best practices, please read the Bisha Mine Human Rights Work Plan 2016
Yes, there were some benifits to people, but I saw the interviews of the “victims”.
Canada’s Nevsun defends Eritrea mining after damning UN report …
http://www.ctvnews.ca/…/canada-s-nevsun-defends-eritrea-mining-after-damning-un-report...
Sep 4, 2015 – The Nevsun lawsuit is one of the first test cases of Canadian mining companies being sued for operations abroad, along with separate cases …
The UN report, which examined the overall human rights situation in Eritrea, found that “systematic, widespread and gross human rights violations have been and are being committed in Eritrea under the authority of the government. Some of these violations may constitute crimes against humanity.”
Thats just a piece of it.
But it doesnt sound too good, and since we have other options to invest….also, Nevsun isnt the only guilty company.
If a person wants to invest ethicaly, same as anything, DD is required.
Thanks Excelsior. Very informative.
B – I doubt you’ll read this study and get actual facts, but I’ll post it anyway.
Instead you will probably cling to your opinions and prejudices, and keep wishing you could throw innocent Canadian miners in jail for trying to create a win-win in a very difficult county to operate in.
However, in outside chance that you want to know how the people are actually treated and have benefited as a result of Nevsun’s mine, then here is audited, non-opinionated, third-party reviewed study…. (not trashy tabloid piece like what you posted.)
HUMAN RIGHTS IMPACT ASSESSMENT OF THE BISHA MINE IN ERITREA
COMMISSIONED BY
NEVSUN RESOURCES LTD
ERITREAN NATIONAL MINING CORPORATION (ENAMCO)
PREPARED BY: LKL INTERNATIONAL CONSULTING INC.
05 AUGUST 2015
2015 AUDIT
http://nevsuncsr.com/wp-content/uploads/2015/07/Bisha-HRIA-Audit-2015.pdf
I’m not trying to defend Eritrea…. it’s a terrible country with a horrific track record.
However, threatening to jail the executives of Nevsun when they’ve repeatedly done their damnest to improve the lives of the people they touch directly, and really be a light in the area for how to conduct business ethically is a bit much.
I initially felt the same way about Nevsun until I really did some research, because I didn’t want to invest in a company accused of “slave labor” either, when there are so many other choices. However, I’d see them speak at Eric Coffin’s show, and then watch a video of their managment discussing everything they are doing to influence human rights and affect the government in a positive way, that I started reconsidering the affect they were having over there. Now there are 2 more mines opening from other companies now that the government is realizing it can bring in good money off their resources legally and ethically, without resorting to crime. I only hope the other companies that set up shop do as good of a job keeping the community in mind as Nevsun has done. They’ve had a hard road, and tons of disinformation attacks trying to smear them, but if you spend some time on it, you just may start to realize they are one of the good guys over there, and while far from perfect, it’s better than things were when the mine wasn’t there. The government has used the proceeds for bad things (no doubt), but there is a ton of money generated at the Bisha mine going into infrastructure (power/roads/clean water/medical supplies) all of the country. That’s more than most people I know have ever done for the people of Eritrea. In fact, miners are usually picked on, and criticized, but they do more cumulative good for communities than 90% of businesses ever will.
Nevsun’s mining activities at the Bisha mine produced a material amount of waste rock, rather than gold ore;
the amounts of gold and gold ore recovered from the Bisha mine were materially less than estimated by the Company’s reserve estimate, a situation which defendants knew or had reason to know based on data routinely collected throughout the Class Period from the Bisha mine;
Nevsun was progressing through the ore body at the Bisha mine much more quickly than planned, in order to maintain gold production at a rate that would not reveal to investors that the amount of gold was materially less than the Company’s estimate;
Nevsun Settles Two Fraudulent Class Action Lawsuits For A Total Of …
awate.com/nevsun-settles-two-fraudulent-class-action-lawsuits-for-a-total-of-us-12-8-…
Dec 1, 2014 – Earlier this summer, Gedab News also reported that before settling yet another multi-million class action lawsuit on behalf Nevsun stockholders, …
the Company was aware that its resource model was materially defective because the actual amounts of gold mined at Bisha did not reconcile with the Company’s reserve estimate previously disseminated to the investing public; and,
Nevsun materially overstated its gold reserves at the Bisha mine.”
Thats a pce of the article.
Im just not sure what Nevsun says can be believed Ex.
Im sure they are all nice guys and all, but I have other options for investments.
Like I said, I dont buy shrimp from se asia, heck I dont even fly anymore because I think the TSA abuses people, especially kids.
B. I give up.
You are continuing to post inaccurate articles from 2014 that were already addressed when the government, Nevsun, 3rd party firms, the workers, and the community methodically went through all the allegations, and none of them stood up after intense scrutiny.
Beyond all the information you can get on their website dealing with every area of focus on Human Rights, I posted a 3rd Party produced document that doesn’t have and axe to grind like that article you posted.
Take some time and read it.
HUMAN RIGHTS IMPACT ASSESSMENT OF THE BISHA MINE IN ERITREA
COMMISSIONED BY
NEVSUN RESOURCES LTD
ERITREAN NATIONAL MINING CORPORATION (ENAMCO)
PREPARED BY: LKL INTERNATIONAL CONSULTING INC.
05 AUGUST 2015
2015 AUDIT
http://nevsuncsr.com/wp-content/uploads/2015/07/Bisha-HRIA-Audit-2015.pdf
Good follow up Ex, well done.
Glad to share Marty. Nevsun is an extremely well run company, has done far more good than bad in Eritrea, and as for the quality of the assets raised in that article B posted, since then they have prove that Bisha is one of the highest grade and most well endowed Copper/Zinc mines on the planet.
I am very excited to see what they do with Reservoir’s assets in Serbia and all the other exploration projects they got along with that project. That should keep them busy in Europe for some time to come, and it was an excellent merger IMO.
Cheers!
Nevsun 2016 Corporate Social Responsibility Video
Published on Feb 11, 2016
Nevsun Resources Ltd. is committed to ensuring it’s worldwide operations provide a comprehensive positive societal impact. Our Corporate Social Responsibility video provides a glimpse of our efforts and what life is like at the Bisha Mine.
Nevsun’s Transition To a Significant Zinc Producer
Published on Mar 24, 2016
Scott Trebilcock, Chief Development Officer, Nevsun Resources speaks at the Subscriber Investment Summit in Toronto on March 5, 2016. Nevsun is a copper and zinc producer in Eritrea with a history of exploration success and disciplined growth.
Metals Investors Forum:
May 2016: Nevsun Resources Ltd. (NSU) – Scott Trebilcock
Published on Jun 3, 2016
Scott Trebilcock, Chief Development Officer of Nevsun Resources Ltd., gives a presentation at the May 2016 Metals Investor Forum.
I wish I were a fly on the wall of where Exchange Stabilization fund meetings are held at Treasury.
Because, what I think I am observing is a buying of stocks, to kick up the markets each morning, (this brings in the momentum players), then a slow withdrawal of money back out into the Exchange Stabilization fund as the day goes on.
Then repeat again the next day.
There just don’t appear to be any unmanipulated markets left anymore!
As central banks buy nearly everything, technical analysis is a fraud
Zero Hedge today reports the latest findings by Citigroup market analyst Matt King, who has determined that stock markets keep going up because selling in emerging markets has been more than offset by “a surge in net global central bank asset purchases to their highest since 2013.”
Soon, perhaps, central banks will have purchased nearly everything to maintain asset prices and prevent markets from functioning, thereby enveloping the world in “financial repression.” Or, as a high school graduate remarked at GATA’s Washington conference in 2008, “There are no markets anymore, just interventions”:
I thought GATA was better informed than that. That dispatch is flawed.
First, the Central bank that has bought the most stocks is Japan, and that is mostly in Nikkei stocks.
Secondly, although I am not a chartist, charts clearly DO work.
Never a 100%, nothing does.
They work, because many analysts and fund managers use them.
Even in a totally manipulated market they would work, unless the intentions of the Manipulators changed radically and often.
The dispatch was in regards to Citi analyst Matt King posted at Zero hedge. Accumulation of assets chart from 2009-2016 was SNB, BOJ, ECB, FED, EM.
http://www.zerohedge.com/news/2016-07-12/mystery-who-pushing-stocks-all-time-highs-has-been-solved
Recall at the end of January when global markets were keeling over, that Citi’s Matt King showed that despite aggressive attempts by the ECB and BOJ to inject constant central bank liquidity into the gunfible global markets, it was the EM drain via reserve liquidations, that was causing a shock to the system, as net liquidity was being withdrawn, and in the process stocks were sliding.
Fast forward six months when Matt King reports that “many clients have been asking for an update of our usual central bank liquidity metrics.”
What the update reveals is “a surge in net global central bank asset purchases to their highest since 2013.”
More like Exchange SATANIZATION fund
Bernie’s support of Hillary is it an act of a man who has lost his mind, or an act of a man who has lost his faith in humankind, or a bitter man who gave it all and couldn’t reach the ultimate seat of power, I think it was all three. Whatever; he is an unprincipled human being or in short a career politician.
What mind?
He started out as a ultra socialist moron, and now proves he knows nothing about economics or morality. (Just my humble opinion)
Exactly; and his supporters are even stupider than he is. The worst ones absurdly think he can compare to Ron Paul.
Brexit leader Farage has ‘lessons’ for Trump, GOP
BRUSSELS — Brexit advocate Nigel Farage will attend next week’s Republican National Convention in Cleveland, saying the United Kingdom’s vote to leave the European Union holds lessons for America.
Trump is no Farage, that’s for sure.
Of course it holds lessons for America.
Dr Paul compared to Mr Bankrupt? Funniest thing I ever heard!
JRB makes good points about the COTs…
Palisade
On miners correction today
https://m.youtube.com/watch?v=Z-UbN-uBJiw
Oops, sorry for the repeat
Silver found support at the 200 week MA today and the weekly chart still looks good despite the overbought readings.
Thanks Matthew
Look at the volume on your chart Matthew…..halved on this downturn.
Lower volume on a pullback is bullish but that is a weekly chart so we still have three more days. Silver just might end the week higher and on volume not seen since April, 2013.
I agree, that’s why I pointed out the volume.
Major buying of all PMs in Asia now, after the commercials tried a fake takedown in New York.
Palladium up $20 right now!
Kirby on watchdog, market not looking so good.
http://usawatchdog.com/global-economy-critical-condition-code-blue-rob-kirby/
The mining ratio of gold to silver has little to do with price ratio. Sounds good, but it’s ridiculous.
You have to consider relative demand, not just supply.
Just like taking the value of gold in 1935 or 1971 and adjusting for inflation, meaningless without full supply-demand calculus.
From ForeignPolicy.com
JULY 12, 2016
Most people have no idea what’s in an iPhone. Yttrium and praseodymium don’t exactly roll off the tongue, but they’re part of what make smartphones so small, powerful, and bright. These exotic materials are among the planet’s 17 rare-earth elements, and surprisingly, the soft, silvery metals are not at all rare. But they’re found in tiny concentrations, all mixed together, and usually embedded in hard rock, which makes them difficult — and messy — to isolate. In China, which mines 89 percent of global output, toxic wastes from rare-earth facilities have poisoned water, ruined farmlands, and made people sick.
Beyond high-tech gadgets, rare earths play a critical role in national defense, enabling radar systems and guided missiles. Ironically, they also power clean-energy technologies, such as wind turbines and electric cars. This year, global consumption is expected to be about 155,000 tons, far more than the 45,000 tons used 25 years ago. Demand will only grow — likely at an accelerated pace — as the world tries to rein in climate change.
At the moment, only China can satisfy that hunger. Yet in 2010, Beijing cut rare-earth exports by 40 percent — possibly to boost its high-tech sector — and cut off supplies to Japan over a territorial dispute. Its muscle flexing caused prices to soar, sparking new exploration for rare-earth deposits around the world. A boom in illegal mining in China has since driven prices back down, making it extremely difficult for non-Chinese mines to stay open or get off the ground. Nevertheless, the rest of the world hasn’t given up: There are currently 50 deposits at an advanced stage of development (see map below) that could someday challenge China’s dominance.
Photo: VCG/VCG via Getty Images
Note: 2016 production and consumption figures exclude countries that account for less than 1 percent of the total. Measurements are in metric tons. European nations are grouped as a market bloc. Sources: Figures based on current market conditions, opinions of industry experts, and author reporting and analysis. 2016 production/consumption figures are estimates based on data from IMCOA/Curtin University, Chinese Renewable Energy Industries Association, China Ministry of Land and Resources, United States Geological Survey, USGS Mineral Commodity Summary, Critical Materials Institute, TMR Advanced Rare-Earth Projects Index. Process waste streams: China Rare Earth Industry Association, The Elements of Power. Future demand: Environmental Science and Technology (“Evaluating Rare Earth Element Availability”).
A version of this article originally appeared in the July/August issue of FP magazine.
Regarding rare earths, it is hard to sort out which companies are left after the wild ride in 2010- 2011, the epic bubble bursting, most companies were taken down for the count. This of course includes the leader outside of China – Molycorp…… which took out one of the best downstream companies, NeoMetals, but through a series of terrible management decisions and low prices…. (they eventually became Molycrap). Very sad, and I’m sure there are private interests in defense that wanted access to their assets post bankrupcy.
With Molycorp going down the drain, the world turned it’s sights to Lynas, who had a great deposit, but decided to set up it’s processing center a wold away due to tax credits. Unfortunately, as metals prices continued to plummet, they had all kinds of environmental protests in Malaysia when they started up their “LAMP” processing plant. There was such a big stink, and they were made to jump through so many regulatory hoops that it delayed their production for over a year, added tons of expenses, and while they are now producing, they are only a shadow of the company they may have become. Apparently as those protesters blocked ports, roads, and the worksites with their cars, and tweeted on their smartphones and laptops, they missed the irony that those devices wouldn’t exist if someone hadn’t dug the rare earths elements out of the ground in the first place.
Another company that showed so much promise because of it’s downstream processing abilities, multiple plants in the UK and USA and Australia was Great Western Minerals, but with the price implosion, they got in over their heads financially, and ended up going bankrupt around the same time as Molycorp. What a shame….
So of the 3 companies to make it to production Molycorp & Great Western went belly up, and their assets were sold on the private markets (likely to private defense and technology companies), and Lynas is still coughing and weezing along.
_________________________________________________________________________
Rare Earths are still required though, and while not that “rare” in the earth’s crust, the challenge is finding a concentrated deposit that is economic. Many tried and few have succeeded, and there has been a scramble to find an identity for these companies the aftermath of the bubble bursting (like how Avalon is now suddenly a “Lithium company”. I have a list of about 50-60 companies from the rare earth space, and most of those are just shell companies now, but there are few that may still make it into production.
Some of the companies holding their ground in the Rare Earths & Specialty Metals space that have a legitimate chance are Arafura Resources, Ucore Rare Metals, Matamec Explorations, Commerce Resources, Tasman Metals, Pele Mountain, and about another 50 or so that are still suspect.
_________________________________________________________________________
There are 2 companies that have my interest in this sector of specialty metals at present:
1) IBC Advanced Alloys (IAALF) – The are really more of a specialty metal process that works with Beryllium, Copper alloys, and Rare Earths for specialty parts in manufacturing, defense, space, aeronautics, and racing. One interesting development is that Mark Smith [the former CEO of Molycorp, that planted his flag with Niocorp (NIOBF) to focus on the strategic metal niobium] has decided to form an alliance with IBC Alloys, so that IBC can process their niobium. This alliance could develop into something larger where the 2 companies merge, or Mark brings more attention to IBC Alloys. They are also the same company working with MIT, and Texas A&M to develop Beryllium coated Uranium pellets to improve efficiency in nuclear power generation, and lower temperatures, avoiding future meltdowns. If that ever takes off it could also be a game changer.
2) Alkane Resources is my favorite Specialty metals company because, they have rebranded as a Zirconium company (??), but really they are very successful GOLD producers.
*Alkane Resources. (ALKEF – OTC). It primarily explores for gold, copper, zirconium, hafnium, niobium, tantalum, yttrium, and rare earth elements.
What blows my mind is that they actually produced 69,000 ounces of Gold last year!
Alkane Resources is actually producing way more gold than the majority of gold stocks on the planet (because as we know most Explorers will never make it to production, and many development stage companies run into permitting, money, or equipment setbacks). What has my interest peaked is that Alkane is actually producing more gold than many of the touted smaller producers that are more common in gold discussions, and yet I don’t ever hear them brought up by gold investors as a current producer.
Their plan is to mine gold to fund the development of their Zirconium and Specialty metals assets, and it is looking like they are quietly pulling this off with great success.
So unlike any of the other Rare Earth or Specialty Metals companies out there, Alkane Resources is doing a damn good job as a Gold Producer, just so they can eventually fund their true passions. It’s a very interesting company, and I’d enjoy anyone else’s thoughts on (ALKEF).
Alkane Resources Corporate Presentation:
http://www.alkane.com.au/images/pdf/presentations/20160413.pdf
After just going back and re-reading the press release where IBC Advanced Alloys and Niocorp are working together, it is actually a JV for Scandium processing…..
________________________________________________________________________
NIOCORP AND IBC ADVANCED ALLOYS ANNOUNCE JOINT DEVELOPMENT AGREEMENT ON SCANDIUM ALLOY APPLICATIONS DEVELOPMENT
Published Monday, June 20, 2016
IBC also just announced another JV for their Beryllium & Aluminum products. That’s 2 different JVs in the last month:
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IBC Secures Joint Development Contract With BAE Systems for its Groundbreaking Beralcast® Beryllium-Aluminum Alloy
BAE Systems Contract Launches Another Major Development Effort for IBC’s Beralcast® Product With A Global Aerospace Manufacturer
Published Wednesday, June 22, 2016
Hi Shad:
Rare Earths much like uranium,each with their own Fukashima.
One must always be cognizant of China’s dominance in the processing of Rare Earths.
The U.S use to control this technology through General Motors but it was sold to the Chinese for pennies during the Clinton Presidency.
That being said,one must at some point start to entertain the thought of life without Chinese rare earths.
I believe the emerging company with excellent promise,yet totally unproven is Ucore.
The U.S Pentagon is involved with Ucore in their development of the Super Lig Seperation circuit. They have already achieved some impressive results. We are patiently waiting for more to come.Once this technology is proven to scale,this could open the door to a wide host of other possibilities.Ucore also has a nice deposit of HRE’S in a friendly jurisdiction,ALASKA.
Hey JohnK,
Thanks for the response on the Rare Earths discussion, as so little is discussed about it these days, but as you said, “one must at some point start to entertain the thought of life without Chinese rare earths.”
Lynas is still producing some, and there are a few other companies with promise. I highlighted IBC Advanced Alloy (IAALF) and Alkane Exploration (ALKEF) up above but also mentioned:
“Some of the companies holding their ground in the Rare Earths & Specialty Metals space that have a legitimate chance are Arafura Resources, Ucore Rare Metals, Matamec Explorations, Commerce Resources, Tasman Metals, Pele Mountain…”
So yes, I do agree with your assessment of Ucore. It is one of the companies that still may be a contributor to this sector, along with the others previously mentioned.
Thanks again for the link back to the Mission Gold takeover by Northern Dynasty.
I didn’t go back to 2015 news because I got the impression it was a very recent event. 🙂
It still seems most of the focus in news releases, the website, and their corporate presentation is focused on resolving the water/wildlife issues at Pebble.
Cheers!
As for Uranium stocks, I’ve been a big buyer over the last few weeks. Are there any Uranium companies you are liking at present?
The original article says that China can, at whim, or in case of a serious deterioration in foreign relations, essentially close down American high tech.
Worry about S. China Sea claims.
Jaguar Reports Strong Second Quarter Production of 24,222 Ounces of Gold
TORONTO, July 12, 2016
Richmont Reports Strong Second Quarter Results from Island Gold; Consolidated Results On-Track for the Upper End of Production Guidance and Lower End of Cash Cost Guidance
TORONTO, July 12, 2016
Newmarket Gold Achieves Record Quarterly Production of 61,191 Ounces in Q2, 2016, Produces 119,248 Ounces in First Half of 2016
VANCOUVER, BRITISH COLUMBIA–(Marketwired – July 12, 2016)
Roxgold reports production results for period ending June 30, 2016 and announces 14,482 ounces of gold poured in first six weeks of production
TORONTO, July 12, 2016
First Majestic Produces 4.7 Million Silver Eqv. Ounces in Second Quarter
VANCOUVER, BRITISH COLUMBIA–(Marketwired – July 12, 2016)
Fortuna Reports Production of 1.6 Million Ounces of Silver and 9,365 Ounces of Gold for the Second Quarter 2016
VANCOUVER, BRITISH COLUMBIA–(Marketwired – July 12, 2016)
Klondex Reports Record Quarterly Production of 41,436 GEOs
VANCOUVER, BC–(Marketwired – July 12, 2016)
Mandalay Resources Corporation Announces Production and Sales Results for the Second Quarter of 2016
TORONTO, July 12, 2016
Nice to see a mining company with an actual P/E ratio
Ex, thanks for your efforts.
I’m also following Scandium technology, because of its potential alloys.
Nice. That release regarding the JV between Niocorp and IBC Advanced Alloys seemed interesting to note.
Scandium is a transition metal (element #21) that can provide many powerful benefits to industries such as commercial aviation, automotive, precision manufacturing, defense, electronics, and others. When alloyed with aluminum, for example, it can increase the strength and weldability of the aluminum used in commercial airliners, which in turn can reduce a plane’s weight, fuel consumption, and emissions per passenger mile. ONG Commodities LLC (“ONG”) has estimated that $1.0-$1.5 million of scandium oxide in a Boeing 737NG single-aisle airliner can offer $10-15 million of net present value in fuel savings alone.[1]
Scandium is scarcely used today because global production is severely constrained and unreliable. The U.S. Geological Survey recently estimated that only 10-15 tonnes per year of scandium are now produced. However, independent experts such as ONG estimate that latent demand in the aerospace and solid oxide fuel cell sectors alone is several hundred tonnes per year.
NioCorp expects to come online as one of the world’s leading producers of scandium from its Elk Creek, Nebraska Superalloy Materials Project, potentially producing as much as 97 tonnes/year. IBC is a leading advanced alloys company that produces high-performance alloys in a range of product forms for multiple industries and platforms, including cast components for the F-35 Joint Strike Fighter. The joint development agreement announced today signals the companies’ intent to collaborate in ensuring a reliable and secure U.S. supply of scandium and catalyzing greater scandium use across a variety of industries.
The President of IBC Engineered Materials, Chris Huskamp, will be leading the joint development effort for IBC. Mr. Huskamp is a former Boeing Associate Technical Fellow in advanced metallic processes who is credited as a named co-inventor of two pending patents regarding scandium-bearing aluminum alloys. The first pending patent can be seen here, and the second one can be seen here.
Scott Honan, Vice President of Business Development of NioCorp and President of Elk Creek Resources Corporation, will manage the initiative for NioCorp. Mr. Honan is leading the effort to develop and build NioCorp’s niobium / scandium / titanium mine and processing facility in Nebraska, and has more than a decade of experience in producing advanced materials that are used in high-performance alloys.
“This joint development effort should deliver value both to NioCorp and IBC, and it highlights the powerful industrial logic of an upstream materials company jointly developing applications with a downstream advanced alloys producer like IBC,” said Mark A. Smith, CEO and Executive Chairman of NioCorp. “NioCorp intends to establish a secure and reliable supply chain for scandium, and our partnership with IBC will leverage our ability to simultaneously accelerate applications development and market uptake of our scandium production.”
“Advanced alloys are continuing to revolutionize many industries, and IBC’s strategic goal is to catalyze new applications for scandium-containing alloys so that we can expand our markets beyond those we are now able to address with advanced beryllium and copper alloys,” said Major General David “Duncan” Heinz (USMC, ret.), CEO of IBC. “The establishment of a reliable and secure scandium supply chain from NioCorp in the United States, coupled with our team’s world-class experience with scandium-containing and other advanced alloys, make this joint development effort very attractive for our two companies and for U.S. industries as a whole.”
The General continued: “We intend to grow a whole new class of advanced products made here in the U.S from our superalloys. Not only will IBC products help meet a growing market demand for advanced alloys, but they also will help address some of the world’s greatest problems, such as climate change and reliance on fossil fuels. By providing greater strength and reduced weight, our advanced alloys increase fuel efficiency and reduce greenhouse gas and other emissions. They deliver real and measurable results today in the effort to tackle these enormous global challenges.”
Just in case there were any Scandium investors that missed the link. Wink 😉
IBC Advanced Alloys Corp. (IB.V) 0.770.05 – up (6.94%)
As of 9:50 AM EDT
Ex, Thanks for your energy with the various issues. I had an excitement 10 years ago in RE’s. A big focus of attention on financialsense.com back then.
Yes the REEs were big news 5-10 years ago, but have had an epic fall from grace even larger than PMs or Uranium. However, like every boom cycle, there were a few good companies and assets discovered or developed out of the 60+ companies I followed, and handful of them still show some promise.
If you have any that you still feel may have value, please don’t keep it a secret.
Have a great day in the markets.
Kaiser, of bottom fishing fame, has included it often in his conference talks quite often.
Sc is a light 3d (first transition series) metal, just before Ti, V, Cr, Mn, if I remember correctly.
If there really is the pent of Scandium demand in aerospace and defense mentioned in the press release above , then both IBC Advanced Alloys and Niocorp should do well.
Here is an article that discusses more the need for scandium, and names a few more mining companies that may benefit. Pele Mountain (who I mentioned above in the REE section) and Platina Resources are 2 that I also follow, but there are a few companies listed in this article that I was unfamiliar with.
Check it out:
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Why Everyone Is Talking About Scandium: Ryan Castilloux
The Gold Report | May. 4, 2015
http://www.mining.com/web/why-everyone-is-talking-about-scandium-ryan-castilloux/
should have said “pent up Scandium demand…..”
The premium in physical silver has been climbing at a rate of about 2 cents/hour on the SGE Exchange (compared with the COMEX) for several hours this morning.
I don’t know what that implies…….pent up demand for when folks wake up in the US, perhaps?
We’ll see in 28 minutes….
I mean 22 minutes….
Ag on SGE is currently $20.56.
Pd in London is currently up $18.50 since 00:00 GMT.
The PGMs have been strong the last few weeks.
GDJJ and JNUG doing well today.
I added the 20-day MA to the gold daily chart, which seemed to be missing. I think the moving average touch points are important. Just because you have a one-day sell off in gold prices and historic highs in the Indeces doesn’t mean ‘it’s all over for gold’
I can see gold prices coming off of an overbought condition, but to declare a major correction is too premature. The trend has not changed.
http://schrts.co/YG7Ums
I would be waiting for the declaration that a new economic paradigm is in order before piling into volatility.