Sean Brodrick – Tue 12 Mar, 2019

Comments on Lithium and Central Bank Buying Of Gold

Sean Brodrick, Natural Resource Specialist at Weiss Ratings shares his thoughts on the lithium market and the types of stocks he is looking to invest in. We also look into the gold market and address the large amount of central bank buying in 2018. Central banks bought over 650 tons of gold last year which was the most in 47 years. However the price of gold was still marginally down for 2018… In US Dollar terms!

Click here to find out more about Sean and the Weiss Group.

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Comments:
  1. On March 12, 2019 at 1:41 pm,
    Matthew says:

    Off topic but relates to gold:

    The Only Way to Drain The Swamp…
    https://www.howestreet.com/2019/03/11/the-only-way-to-drain-the-swamp/

    Bill Bonner totally gets it.

    • On March 12, 2019 at 4:03 pm,
      OOTB Jerry says:

      Good article…….JMO

    • On March 13, 2019 at 12:40 am,
      Charles says:

      Great Chart. His charts look impressive, but based on your chart it sounds like his articles are a good buying opportunity!

      • On March 13, 2019 at 6:42 am,
        Matthew says:

        I think you’re right about the buying opportunities. Based on his public material, he’s been consistently wrong for years and years!

    • On March 12, 2019 at 8:14 pm,
      Matthew says:

      That guy is another quack of a chart doctor:
      http://schrts.co/pHpXsytF

      • On March 13, 2019 at 5:04 am,
        OOTB Jerry says:

        Radomski……….might need to look for another job….Looks like chart reading is not his specialty….another guru bites the dust…….lol

        • On March 13, 2019 at 5:05 am,
          OOTB Jerry says:

          Does he have a job at the FED.. or JPM..maybe the Crimex……..lol

  2. On March 12, 2019 at 5:58 pm,
    Matthew says:

    GDX is in a steepening uptrend (since last summer):
    http://schrts.co/bQfmuejM

    • On March 12, 2019 at 6:00 pm,
      Matthew says:
    • On March 12, 2019 at 10:28 pm,
      Excelsior says:

      Good observation from @Goldfinger on the outperformance of the miners of the metal.

      ________________________________________________________

      @Goldfinger — “Gold miners continue to strongly outperform gold itself; $GDX and $GDXJ both +7.7% year-to-date while gold is +1.1% in 2019. ”

      http://cdn.ceo.ca/1e8g8a1-GDX_GDXJ_Gold_3.12.2019.png

      • On March 12, 2019 at 11:11 pm,
        Matthew says:

        Yes, here’s one I posted recently that shows the XAU up 6%+ vs gold ytd and 18%+ since the November low:
        http://schrts.co/RDNQJytM

        • On March 13, 2019 at 12:28 am,
          Excelsior says:

          It will be nice if the breakout does stick. Thanks – good chart of the miners gaining traction.

          • On March 13, 2019 at 5:07 am,
            OOTB Jerry says:

            ditto…………on the stick……..

  3. On March 12, 2019 at 9:17 pm,
    Excelsior says:

    World’s top maker of battery cells for EVs to open German plant in 2021

    Cecilia Jamasmie | Jan. 23, 2019

    http://www.mining.com/worlds-top-maker-battery-cells-evs-open-german-plant-2021/

    • On March 12, 2019 at 9:18 pm,
      Excelsior says:
      • On March 12, 2019 at 9:28 pm,
        Excelsior says:

        A Behind the Scenes Take on Lithium-ion Battery Prices

        March 5, 2019 – Logan Goldie-Scot – Head of Energy Storage – BloombergNEF

        “Automakers and policy makers are increasingly voicing their belief that the passenger vehicle of the future will be powered (partially or fully) by electricity. There remains, however, a lack of consensus on the timing and speed of the transition, in large part due to differing opinions on current and future lithium-ion battery costs and performance. The rise of the electric vehicle is also forcing automakers to reconsider their role in the automotive supply chain, for example by bringing more battery expertise in-house.”

        https://about.bnef.com/blog/behind-scenes-take-lithium-ion-battery-prices/

        • On March 12, 2019 at 9:33 pm,
          Excelsior says:

          These Metals Should Benefit The Most From EV Adoption

          February 26, 2019 – by Michelle Jones

          “The supply chain begins with materials like lithium and cobalt. As EV adoption increases, demand for these materials and other metals specifically used in EVs should rise dramatically. The next step in the supply chain involves high-tech components such as semiconductors. Next is what they call “autonomous subsystems,” which basically entails LIDAR and other systems used for autonomous driving.”

          “Not all the lithium-ion batteries used in electric vehicles have the same composition, so different batteries contain different amounts of metals and other materials.”

          “Battery anodes mainly consist of graphite and silicon.”

          “They added that the EV market has gradually shifted toward batteries with higher energy densities to increase the driving range of EVs. As a result, cathode chemistries are shifting toward nickel-manganese-cobalt and nickel-cobalt-aluminum formulations.”

          https://www.valuewalk.com/2019/02/metals-supply-chain-for-electric-vehicles/

          • On March 12, 2019 at 9:35 pm,
            Excelsior says:

            Warren Buffett: Electric cars are in America’s future

            Mon, 25 Feb 2019

            “In an interview with CNBC’s Becky Quick and Joe Kernen, Berkshire Hathaway’s Chairman and CEO Warren Buffett addresses why he has invested in autos and electric cars in China more than in the United States. Buffett addresses the future of electric cars in America and how the operation to create more solar powered cars differs in America than in China.”

            https://www.cnbc.com/video/2019/02/25/warren-buffett-electric-cars-are-in-americas-future.html

          • On March 12, 2019 at 9:42 pm,
            Excelsior says:

            LITHIUM’S SECOND COMING

            February 24, 2019

            “If you invested in Lithium stocks back around 2015, you also watched the hype build, culminating in very high valuations by 2017. What was quite obvious at that point, is that prices were driven by what might be, rather than any factual basis. Lithium stocks were simply over-valued at the time based upon hype.”

            “Prices then corrected in 2018 amid talk of an over-supply. One particularly famous comment of ,”a tsunami of over-supply”, was rightfully ridiculed. However, few had worked out the effect of new supply coming online from mines such as Altura and Pilbara Minerals.”

            “While some lament the damage to their portfolio during 2018, I consider it a time of reflection and preparation for the next cycle. The fact that the market has applied normal mining cycle rules to lithium, will mean that the next cycle will be closer than we think. Projects that needed to start in 2018 for production in 2021 have stalled. This, I believe will create another hole in supply and subsequently the next wave in the cycle. When deciding upon a cycle strategy, my focus is on identifying who is comparatively undervalued, and positioning a portfolio to take maximum advantage.”

            https://mastermines.global/articles/lithiums-second-coming/

        • On March 12, 2019 at 10:07 pm,
          Excelsior says:

          World’s insatiable appetite for batteries sparks lithium mining boom in Australia

          “Growing demand for batteries for electric cars and power storage is driving increased investment in lithium mining in Western Australia.
          WA is currently supplying more than 40 per cent of the world’s lithium and a new mine in the Pilbara is the latest in a string of investments in the industry.
          The West Australian Government is now encouraging industry to build a battery factory in the state to capitalise on the boom.”

          https://www.youtube.com/watch?v=P-BZ_vFJWG0

          • On March 13, 2019 at 12:56 am,
            Charles says:

            Hi Ex – What is the best way to play the next Lithium wave. I have never played in the space and am looking for US, Canada or Aussie jurisdiction, established/cash flowing producer or royalty company with strong management. Thanks and cheers!

          • On March 13, 2019 at 4:37 pm,
            Excelsior says:

            Hi Charles,

            I made some nice returns from the 2015-2017 surge in Lithium stocks betting on the horses that were advanced developers and near production (Galaxy, Orocobre, Nemaska, Lithium Americas, Pilbara Minerals, Neometals, Kidman, etc…). I peppered in a few explorers, but just feel it is too hard to know what a good discovery is, and unlike other metals, it takes advanced understanding of chemistry to make a Lithium deposit work, so I wanted companies that were focused on that and had a clue what they were doing.

            I trimmed back those positions in 2017 and sold out of a few, but not nearly enough. Most of the sector pulled back in the second half of 2017- 2018.

            Currently, I still have positions in Galaxy, Pilbara Minerals, Orocobre, and Nemaska. Unfortunately Nemaska hit a funding snag and had to dilute down existing shareholders to get into production, so they got creamed, but I still believe they’ll be viable longer term.

            I’m considering adding back Lithium Americas as an advanced developer and NeoMetals for more downstream processing. Cypress that Cory interviewed has received a bunch of investor interest, but being only in the Clayton Valley has it’s challenges. I used to invest in Pure Energy metals there, but found out the big boys there were pumping the water their way so quick it was a challenge for others.

            In general I’m not a huge fan of brine deposits, and like hard rock miners better, but Orocobre knows what they are doing now (and they have a Borax kicker), and Galaxy and Lithium Americas have spent the time to understand their deposits and the economic viability of them. Galaxy also has hard rock production. Pilbara Minerals is my favorite hard rock Li Miner and new producer, and some still like Birimian, but I’ve never owned it. Altura is a new producer that has a good following, but I’m not sure their economics will be as robust.

            Most of the exploration plays are garbage, and the best assets are already in play.

          • On March 13, 2019 at 6:07 pm,
            Charles says:

            Thanks Ex. I have considered dabbling in Lithium Americas for years, but never pulled the trigger as it seemed at the times I looked it was too extended to be worth the risk. I am glad to here Lithium Americas is still on your list. It seems like the safest of the lot you mentioned. I might put a small amount to work in it just as a tracking position for now so I can get more up to speed on what is going on with the company currently. As always thanks for your thoughts.

    • On March 12, 2019 at 9:47 pm,
      Excelsior says:

      POSCO FINAL SETTLEMENT FUNDS RECEIVED

      March 1, 2019

      “Galaxy Resources Ltd (GXY.AX) (GALXF) is pleased to advise that it has now received the full US$271.6 million consideration payable by POSCO in connection with the sale of the package of tenements located on the northern portion of the Salar del Hombre Muerto. This amount represents the transaction sale price of $280 million, less US$8.4 million in withholding taxes which was paid in November 2018, and comprises:”

      • US$257 million consideration previously held in escrow by the Escrow Agent; and
      • US$14.6 million payable by POSCO directly to Galaxy within 5 business days of completing the registration of certain usufruct transfers.

      https://www.gxy.com/media/announcements/4434jml5ss1d30.pdf

    • On March 12, 2019 at 9:56 pm,
      Excelsior says:

      PIlbara Minerals (PLS.AX) (PILBF)
      Pilgangoora: one of the world’s leading Lithium and Tantalum production centers

      The BMO 28th Global Metals and Mining Conference – 26 February 2019

      • 100% owned by Pilbara Minerals (ASX200, market cap $1.2B)
      • 23 year mine life
      • Established transport and port infrastructure
      • Stage 1, 2Mtpa processing plant
      • LOM Stage 1 production of 330,000tpa spodumene concentrate and 321,000Ibspa of tantalite
      • Production ramp up well underway
      • Regular customer product shipments
      ~6% spodumene concentrate +5% tantalite concentrate
      • +25% tantalite concentrate production under development

      http://www.pilbaraminerals.com.au/site/PDF/2346_0/CorporatePresentationFebruary2019

    • On March 12, 2019 at 10:00 pm,
      Excelsior says:

      Cauchari JORC Resource increases to 4.8 million tonnes Measured + Indicated
      and 1.5 million tonnes Inferred LCE #Lithium

      7 March 2019 – Orocobre Limited (ORE.AX) (ORL) (OROCF)

      https://www.orocobre.com/wp/?mdocs-file=5484

      • On March 12, 2019 at 10:02 pm,
        Excelsior says:

        Orocobre Limited – Half-Year 2019 Financial Results WEBCAST

        Feb 24, 2019

        “Orocobre Limited (ASX: ORE, TSX: ORL), a dynamic global lithium chemicals supplier, has released its financial results for the half-year ended 31 December 2018.”

        https://www.youtube.com/watch?v=IzEjEL8YdNY&feature=youtu.be

        • On March 12, 2019 at 10:04 pm,
          Excelsior says:

          “Click to view the Orocobre (ORE.AX) (ORL) (OROCF) Corporate Video showcasing an aerial and up close view of our operations at Salar de Olaroz and Borax Argentina S.A., with an insight into Orocobre’s Stage 2 Expansion at the Olaroz Lithium Facility.”

          “In partnership with Toyota Tsusho Corporation (TTC) and JEMSE, Orocobre has built and is now operating the world’s first commercial, brine-based lithium operation constructed in approximately 20 years.”

          https://www.orocobre.com/news/orocobre-corporate-video-2017/