Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Byproducts V: Why the Run-Up in Cobalt Demand?
By Jack Lifton
27 Dec 2007 at 03:17 PM GMT-05:00
DETROIT (ResourceInvestor.com) -- The following price charts from the excellent new Internet minor metals information center http://www.minormetals.com, published by TheBullionDesk.com, clearly show the roller coaster ride that cobalt has been on during the last six months in particular, and the last two years in general. In the earlier period cobalt first doubled and then plateaued. Now in the last six months of 2007 cobalt prices have gone up another 50% above the base established during the plateau period The total increase in price of cobalt over the last two years has, as of now, been 300%; thus cobalt has been a far better investment during the last two years than either gold or platinum.
Is the current cobalt price run-up a “bubble”, or the froth around a bubble, or is it a solid movement in demand that is running ahead of supply? There are just two reasons why the price of a natural resource goes up:
The real (actual) demand exceeds the supply, or;
Speculative demand exceeds supply.
I believe that cobalt is going up in price because of a combination of the above two factors. First of all the existing uses for cobalt are growing and show no signs of moving to substitute materials. Second, a “new” cobalt use, which has so far flown under the investment radar, has begun to grow, and I believe that this has initiated a speculative surge in demand among commodity market players and a surge of risk management by the purchasing departments of some large corporate end-users of cobalt.
The first factor to be noted in trying to form an understanding of cobalt pricing and supply is the fact that “cobalt is not found as a native metal but generally found in the form of ores. Cobalt is usually not mined alone and tends to be produced as byproduct of nickel and copper mining activities…. In 2005, the Democratic Republic of the Congo was the top producer of cobalt with almost 40% of the world share, followed by Canada, Zambia, Russia, Brazil, and Cuba.”
The USGS notes that “The United States did not mine or refine [any] cobalt in 2006,” but that the U.S. imported for consumption 11,800 metric tonnes of cobalt in 2006. Since the USGS gives total mine production of cobalt globally in 2006 as 57.500 metric tones, it is clear both that the U.S. is a major consumer of cobalt and that cobalt is truly a minor metal when compared to copper and nickel, from the ores of both of which it is principally extracted, as a byproduct.
An excellent and comprehensive discussion of the current strategic and critical applications of cobalt is to be found in the October 2006 issue of the Journal of Metals, which is a subscription only publication for members of The Metals Society, a first-class organisation for those interested in technical metallurgy.
I will summarize the article briefly:
It says that “Cobalt has played an important part in the composition of nearly all the new alloys developed since the 19th century for cutting tools and wear resistance. The special properties of cobalt have been utilized in such applications as catalysts, paint dryers,…, and rechargeable battery chemicals. …Superalloys are major applications…. The major uses of cobalt based superalloys (45% cobalt) are in turbine blades for aircraft jet engines and in gas turbines for pipeline compressors.”
Of special interest from the article is the comment that “Cobalt-based batteries are…[an] extraordinary application where the use of cobalt in rechargeable batteries grew enormously between 1995 and 2000….The addition of cobalt to the electrodes substantially enhanced the cell’s life, increased [nickel metal] hydride thermodynamic stability, and inhibited corrosion.”
Finally, note the final paragraph of the article especially the last sentence, which I have put in italics:
“The increasing use of cobalt in rechargeable batteries for electric vehicle applications is expected to increase the use of cobalt even further. A major shift to hybrid-electric vehicles in automotive technology will dramatically increase the demand for cobalt-based batteries. Newly emerging demand combined with increases in cobalt use for other types of turbine engines and gas-to-liquid catalysts is underpinning the recent growth in cobalt demand and is expected to drive future cobalt consumption to unprecedented levels.”
Toyota has just announced this month that it plans to manufacture 1 million hybrid-electric vehicles a year sometime in the 2010s. It is clear that even if Toyota’s goal is not met in the actual year of 2010, the total number of hybrids made that year just by Toyota, GM and Honda will meet or exceed 1 million units. This fact is, in my opinion, the principal driver today of cobalt prices.
Let’s look at the numbers: At least 1.5 million hybrid vehicles have been manufactured since Toyota introduced the first mass produced vehicle of this type, the Prius, in 1999. Toyota alone has already made 1 million of them and 79% of all of Toyota’s hybrid vehicles have been sold in the U.S.
I have frequently reminded readers of Resource Investor that the nickel metal hydride battery packs used in a Prius contain up to 300 pounds of nickel and as much as 64 pounds of rare earth metals, principally lanathanum. Today I want to point out that each battery pack also contains cobalt. The comprehensive article “Developments in hybrid vehicles and their potential influence on minor metals”, written and presented in 2005, contains the graph below and the surrounding commentary:
The conclusions and graph above are based on the premise that future hybrid vehicles will continue to use nickel metal hydride batteries; I personally predict that some, and perhaps, even all, hybrids will utilize safe reliable nickel metal hydride batteries at least as far into the future as the above graph runs.
All of the “new” cobalt demand coming just from hybrid vehicle nickel metal hydride battery construction is today probably already in excess of market supply. Cobalt production has tripled in the last 12 years from 20,000mt per annum in 1995 to nearly 60,000mt per annum in 2007. Production will have to increase by another 25% just to keep in equilibrium with the above forecast hybrid demand and the natural growth in existing uses. A friend of mine warned me on the phone today that there is a high probability of a downside to this optimistic view of demand exceeding supply. He said that if a safe reliable lithium technology battery is developed for hybrid vehicle operation then cobalt will immediately be in surplus and the price will crash from today’s highs.
Let’s examine his thought a little. The highest energy density most efficient lithium technology battery available today, which is almost universally used in laptops, cell phones, and even concept cars is the one based on lithium/cobalt oxide electrode technology: the so-called lithium ion battery. I have written before that the world’s largest lithium producer, Chile’s SQM [NYSE:SQM], and the General Motors Corporation both agree that an optimum size lithium-ion vehicle propulsion battery would need 2 kilograms of lithium.
The (reversible) chemical reaction that describes the operation of this widely used battery is:
The above equation tells us that a battery pack utilizing 2 kilograms of lithium will require 8.4 kilograms of cobalt or 18.5 pounds; this is six times as much as the current nickel metal hydride batteries!
So, if nickel metal hydride battery packs were converted to lithion-ion, cobalt type, batteries then the 2015 demand just for such batteries of cobalt would be nearly 50,000mt annually or the equivalent of nearly all of today’s annual supply!
Take heart, though, because we are told that all kinds of newer cheaper and safer lithium ion battery technologies are “being developed.” But, in the meantime….
Ultimately I would predict that a compromise will be reached. I think that a large proportion of workaday hybrid vehicles will be made and continue to be made with nickel metal hydride batteries; some of the rest will be made with exhaustively researched and more safely designed lithium cobalt ion batteries; and the top few performance types will use one of the non-cobalt based lithium ion battery technologies.
I say this because it is clear that end-users are bidding up cobalt prices to insure their supplies for the near term production of items like superalloys where cobalt is absolutely critical and cannot be substituted, and that battery makers are hedging their bets on the future composition of the end-use hybrid battery market by laying in supplies of the metal even as, and, in particular, in case that, the global economy slows down because they recognize that since cobalt is a byproduct, a drop in either copper or nickel demand immediately impacts not only the supply of those metals but also of cobalt. The battery makers know that the demand for hybrids may well rise if the price of oil continues to go up and that hybrid vehicle customers will not wait forever for new battery technologies.
Dollar investors, take note: At this point I want you to keep in mind that the increase in demand for cobalt for the new hybrid battery use is coming today entirely from outside of the United States. Essentially all vehicular hybrid batteries are today being made in China and Japan. China and Japan both believe in national stockpiling by government funded agencies for critical metals. Private Japanese “trading” and mining companies and both “private” and state-owned Chinese trading and mining companies are today diligently scouring the world for sources and supplies of critical and strategic metals such as cobalt, nickel and lithium because, for example, in the case of cobalt, they are worried about the most extreme of the above scenarios. The Chinese are concerned first and foremost with keeping their domestic economy fed with the natural resources it needs. The Japanese also have this as a goal but it is to ensure their survival as a trading nation as well. In either case cobalt, among other resources, will be mostly unavailable in the global market place after it is acquired by China or Japan.
Should the Japanese and Chinese succeed in locking up most of the additional supply of cobalt to be created during the next decade and the most extreme of the above demand scenarios materialize, it will be a significant blow to American heavy industry and the U.S. military. In the case of civilian industry, it could result in the acceleration of its relocation to China.
< Back | Post to del.icio.us | Digg this | Respond to this story >
Please wait while generating PDF.....xPlease wait while generating PDF.....
increase font size
decrease font size
toggle typeface
e-mail this page
print this page
Generate PDF of this article
company hub
search for related news
view all comments (7)
bookmark this page
make this my homepage
view TOP 10 most popular articles
Digg This Article
Post This Article To del.icio.us
Go To RSS Feeds
Comment on this story (7)
Tim Wood's Advice is Very Sound - Posted by Jack Lifton, 28 December 2007
Cobalt Investment Exposure - Posted by Ron Bye, 28 December 2007
Exposure to cobalt securities - Posted by Tim Wood, 28 December 2007
Cobalt Investment exposure - Posted by Tom Edwards, 28 December 2007
Cobalt - Posted by Steve Higgins, 28 December 2007
More Comments >>
Conflicts and Disclosure Policy | General Terms of Use | Privacy Policy |
© Copyright 2007, Resource Investor.
Designed and Developed by Absol Internet Business Solutions | Powered by AbsolPublisher.
I have been talking about Cobalt for three years. The US goverment stockpile is down to zip. They have none left to sell. At 92 I will not be around to see my two little Cobalt picks go to twenty dollars a share from two,but you will if you buy them. BAJ---- and------FT
Its time to buy this pig.
All opinions expressed are my own. Hawley is not in this for a quick double or triple. He has ever intention of building a real company that is going to be around a long time.The Bac-Tec deal where we will now own 51% of a company that has proven technology for recovering gold and base metals in enviromentaly friendly ways. Thats a long term outlook. Not wanting to list on a major US exchange. Thats a long term outlook. After the first of the year there will be two buy recomendations coming out. Eight or nine months from now. The cash flow from the start up of the mine will start. Hawley will look for something else to buy. He will build a company that will last. I for one, will still be here.
There is no fool,like an old fool. So I bought more. In for a penney,in for a pound.
The answer at scottrade was. It was put on the restricted list most likely because of (suspicious trading activity). I can still trade it. But not online. Now have to call and use a broker. That sure gives it a negative connotation.
What is NNS?
For what its worth. I just tried to put a buy order in for more stock at Scottrade and it would not take the order. It said your local office for further information on this stock.
Maybe a prayer from petey would help, it couldn't hurt.
Methinks the fish in them pictures is suckers not strippers.
Are there any other companies drilling for oil and gas on the island? If so, has any been found?
PUT IN A PICTURE OF ALL US INVESTORS. A LONG ROW OF SUCKERS.
Its a sad day in the USA when this is the only stock in my portfolio that didn't get murdered.
Petey may be the only one that makes out on this deal!
I only bought this stock because of you. I liked your fake fish pictures.
If its a sham its the best I ever saw
Whats an mm ?
Whats a 504 ?
Good I still got a chance.
It was CYGX, my 92 year old fingers are crooked and type on an angle.
You telling me they finialy got something right? HE HE HA
I only bought this thing because I thought you were going to lead me to greener pastures. Then I overheard some stupid bird say he thinks you have a postion in CYGC. At that point I knew I was dooooooomed. THE OLD GUY
Little said it would be signed by Tuesday.Today is thursday. Perhaps he was mistaken on the week,month or year. The buying late last week came out of Florida, as a new group of suckers were lured into the trap. THE OLD GUY
I must be dumb. I bought more today. THE OLD GUY
Who do you talk to at IR . What number do you call? THE OLD GUY
For what its worth. I was the lead investor for many deals and good patent attorneys were always 2 to 3 thousand a day. If they have the volume that they need a full time attorney, I will take that as a very positive development. THE OLD GUY
Miningguy2004 Do you remmember I said I was big on Cobalt. Read the part on Cobalt. You might have to wait 2 to 3 years but
One More for the Road
By Peter Grandich
Dec 3 2007 9:58AM
www.grandich.com
Dear Santa,
First, I want to thank you, TOUT-TV (CNBC-TV) and all the little elves of the “Don’t Worry, Be Happy” crowd on Wall Street for making it a wonderful Christmas period again these last several days. It’s so good to know all is well again, not to mention Elvis and Jimmy Hoffa are with you.
There’s no need to get me anything but I realized this past week or so that there’s one, and only one, perfect gift; could you either get me a membership for the "Plunge Protection Team" or better yet, a partnership at Goldman Sachs? I’ve viewed their employee video and realized it’s the perfect Christmas gift.
XOXO, Peter
Barring some unforeseen circumstance, this will be the last issue of The Grandich Letter for 2007. Our offices will be closed from December 8, 2007 through January 6, 2008.
The markets will trade in more and more of a holiday-like atmosphere as we get closer to year-end. Because of this, we could see moves exaggerated by lack of liquidity. For the most part, it’s safe to assume we’re not witnessing any earth-shattering changes to longer term directions.
General Overview –
On the slight chance that General Kudlow, King “BooYah” and the vast armies of the “Don’t Worry, Be Happy” crowd on Wall Street umpteenth pronouncement that all is well and it’s safe to go in the water again is wrong (perish the thought), I’m going to watch this video again and remind myself of the following saying before I buy into the latest “all clear” signal:
"He who thinks he is raising a mound may only in reality be digging a pit." - Ernest Bramah
December is not usually a good month for stock market bears. With the gang on Wall Street’s Christmas bonuses riding on yearly results and a general “merry” atmosphere taking hold through years-end, I fully suspect this latest dip in the bull pool isn’t going to cause a Jaws-like exit anytime soon. However, I do believe it’s actually beneficial to the bear cause, as a major distribution top is forming that can seal the crazed Boo-yahs’ fate for years to come.
So don’t be a Grinch (or feel like one) and not enjoy the next few weeks. All the factors that led me to publish this issue on October 14, 2007, remain.
Precious and Base Metals –
One should not expect a bullish outlook on gold from Wall Street, mainstream financial media and the public-at-large, because it’s almost certain to come at the expense of financial assets and/or the argument for them. However, given how incredibly well gold has performed for the last several years versus financial assets, and the fact that it’s latest “pause that refreshes” has once again launched a wave of bearish gold forecasts (Goldman Sachs the latest – I think the G in G-7 now stands for Goldman since so many former executives are making up positions in financial arms of countries), I think its fool-hearty not to give credence to GATA and those of us who know in our hearts that governments and powerful groups interfere in so-called free markets. Yes, it’s frustrating at times when they do, but the amount and the degree in which they have in recent times strongly suggests to me that, as time goes on, the problems they so much want to keep under the rug are becoming more unmanageable for them.
Despite the grief I took through much of 2007 (including from clients and the many who wished to be clients, but in good faith I couldn’t take them on) for being outspoken bearish on base metals and choosing to be greatly over-weighted in precious metals, I believe the price action has proven me correct. Since I get beaten up enough in the junior resource market (where I always stress failure is the norm), I won’t gloat other than to say I see no reason to change that view anytime soon.
Gold –
A dramatic, near parabolic rise from $640 to $840 is now rightfully being digested. As noted earlier, liquidity should dry up as we get closer to Christmas so I wouldn’t get overly concerned whether the next $25-$50 move is up or down. Just stay focused on what got us to this price, the fact that fundamental factors remain supportive, and the world still pretty much hates the shining yellow.
Copper –
It recently tested key support just under $3 and bounced. I do believe it should eventually break that support as a massive top has formed technically and my long-term target of $2-$2.50 looks more likely. I do believe that as the price weakens to a move below $3, one should re-established with some copper exposure. The $2-$2.50 area should prove to be just a corrective level and in the next 3-5 years a move to new highs above $4 appears in the cards.
Uranium –
The sentiment has gone from extremely bullish to one of concern or outright bearishness. This comes despite perhaps even more bullish fundamentals. I continue to believe uranium exploration, development and producing companies are worthy of consideration.
Cobalt –
A few months back I noted Cobalt appeared to be a metal that could see strong price appreciation. Given this, I found this article most interesting:
Cobalt has been riding high over the past month where many other markets failed to pick up after a slowdown in the third quarter. The weak dollar had some part to play in this, with UK traders reporting both an increase in enquiries and requests by sellers to be paid in sterling.
Having topped $30/lb in mid-October the market continued moving steadily upward towards $35/lb, buoyed by both a shortage of material available in the spot market and bullish sentiment, which has seen investors start taking positions in the market. The London Metal Exchange is also, once again, turning its eye to cobalt to determine whether it, along with other minor metals, could feasibly trade on the exchange.
There are mixed feelings on whether the minor metal markets are liquid enough and would be open to the kind of transparency that the LME requires. A poll by Metal-Pages, however, came out with a surprisingly balanced result, with a small majority of those responding happy to see their metal trade on the LME. Having opened a market in cobalt futures to investors in September, Credit Suisse said the market has been even more successful than expected. This, and the fact that cobalt is already sold on open online systems by producers, makes this metal probably the most obvious candidate for trading on the exchange.
At the moment, producer stocks are said to be either sold out or running low and a small volume of five to ten tones is enough to move the market. On their online trading systems, BHP-Billiton and Norilsk Nickel have been leading the way by repeatedly increasing offer prices with every sale. BHP-Billiton moved its offer price up to $35.50/lb on November 21, having reported a five-tonne sale to North America at $34.75, the highest transaction price ever recorded on its website, while Norilsk Nickel raised its website offer price up to $33/lb on November 22.
Previous to that BHP-Billiton had raised its offer price on 16 November, for the second time in two days, to $33.30/lb on the back of a five-tonne sale. Norilsk Nickel had moved its offer price, first to $31.20/lb on 14 November and then to $32/lb on 19 November, basis in warehouse Rotterdam. In China, Jinchuan Group also lifted its price for 99.8% cobalt metal on 20 November to Rmb578,000/tonne, up from the previous Rmb566,000/tonne basis which has been in place since 9 November.
Not everyone is happy with the rising market. Said one major western consumer/processor: “The market is clearly the hostage of an incredible sense of opportunism... With each quote the Russians move up their price and we have another hit or two on BHP... It is not always easy to beat the bulls. We still believe that the hike is on the basis of speculation and not fundamentals, but the end result is unfortunately the same.”
He put the market, in the penultimate week of November, for 99.3% at $32-33/lb and for 99.8% at $33-34.50/lb, against a more general market range of $33-33.75/lb for 99.3% and $34-35 for high grade.
Previously, the price of cobalt, has topped $30 per lb just three times since the mid-1990s: March, 2007, January 2004 and February 1996.
There are now enquiries for 2008 and demand is also said to be boosted by consumption in China, particularly for making batteries.
In China prices for all cobalt products are rising, as availability of raw materials gets tighter. Concentrate prices are now quoted at $28-29/lb. Some producers are said to have halted production and have started to trade raw materials as they have difficulties raising the cash.
Prices towards the end of November went up to about Rmb630-640/kg ($38.6-39.2/lb) for 99.8% cobalt metal, some Rmb450/kg (US$27.6/lb) for 72% min Co cobalt oxide, while offer prices for industrial chemical cobalt oxalate, used in manufacturing automotive tyres have also gone up, to Rmb190,000-Rmb195,000 (as high as $26,351/tonne) for 31% min cobalt oxalate.
Cobalt has a wide variety of applications in industrial chemicals, batteries, aerospace alloys, land-based turbines and power generators. It is likely to see a growing demand in hybrid vehicles, as the automotive industry strives to be cleaner but still affordable. Japanese car manufacturer Daihatsu Motor Co recently unveiled its new fuel cell technology that eliminates the need for platinum in electrode catalysts. By changing from acidic to alkaline electrolyte membranes it can replace the costly metal with cheaper and less corrosion resistant metals such as cobalt or nickel.
Note: The article continues on to discuss other commodities. For a complete copy of the article the reader is referred to the Metal Pages November Newsletter at
U.S. Dollar –
Even beaten-up Uncle Sam is entitled to some holiday cheer. Again, remembering that the drain on liquidity is likely to come as December unfolds, and knowing the big paper profits out there on short U.S. Dollar positions, it would come as no surprise to see the U.S. Dollar Index move back towards, or even above, the 80 level. While it would cause agita for the individual speculator whose time horizon these days appears to be just hours and minutes, it would actually be healthy and useful if it did. Because 80 was a key support area for years, it’s only natural for the market to try and confirm it’s now resistance. I’m not suggesting to get long Uncle Sam, but just suggest not losing sleep over it if it should occur. It would also not surprise me to see some Central Bank intervention in the currency market in the next few months. I may be old-fashioned, but it would be nice to see them act in the light of day for a change.
Oil –
“OH MY GOD”!!!! Oil has fallen all the way back to $88. It’s cheap again –lol! I’ll spend some time on oil in our January issue.
Mining and Exploration Shares –
Given the relative strength in most metal prices versus price levels of just a few years ago, most mining and exploration shares aren’t even close to full valuation when compared to metal prices of 5, 10 and 20 years ago and their relation to mining and exploration share prices at that same time. There are many reasons for this and here, too, I’ll go into it in January. But let me remind you of a month or two ago when I suggested that we’re likely to see some serious tax-loss selling, which we recently have. This may continue for the next week or two, but with more and more compelling speculations making themselves known in this arena, I’m personally hoping to go shopping (if I can bring myself to step over so much carnage—some of which I and many so-called experts assisted unwillingly in creating).
Special Tribute –
Two-thousand-and-seven will go down as the best year in the markets for me, but it was also one of the saddest. While I’m grateful for all the times I appeared in the media, I would give them all up for just one more time with the greatest journalist and friend I ever had, Mr. Jim O’Connell.
Each time the music begins for BNN’s “Market Call”, I will always identify it with Jim beginning the best hour in financial journalism worldwide. Whenever I walk into BNN’s offices, I still yearn to see Jim coming down the aisle with his wonderful smile and overwhelming kindness. But most of all, I miss a great friend, who was a part of so many people’s lives five days a week. To his wife, Lisa, family and friends, who all miss Jim dearly, I will remember you during this holiday period and for the rest of my life so I may honor the greatest gentleman I ever knew.
“Those who walk uprightly enter into peace; they find rest as they lie in death.”
- Isaiah 57:2
GONE BUT NOT FORGOTTEN
© Cecilia M. Kocher
The years we’ve shared have been full of joy.
The memories we’ve made will go on and on.
I haven’t stopped crying since you went away,
and I’ve asked God time and time why couldn’t you stay.
You lit up my life, my hopes, and my dreams.
You’ve opened my eyes to see what it all means.
So now that you’re gone how can I forget;
because you were the greatest out of all I have met.
Merry Christmas, Happy Hanukkah and Peace Be With You in the New Year.
****
Grandich Publications, Inc. provides research, analysis, and investor relation services for certain of the companies featured in the articles appearing in its publications (each a “Featured Company”). Featured Companies may pay fees to Grandich Publications, Inc. that may include securities-based compensation that would appreciate if the company’s stock price rises. Accordingly, there is an inherent conflict of interest involved that may influence our perspective and provide an incentive for publishing favorable information with regard to a Featured Company.
Grandich Publications has been given the right to exercise stock options. A complete list of companies and options and share price (in Canadian dollars) is listed on the website, www.Grandich.com. Furthermore, most companies have entered into agreements to pay Grandich Publications a monthly fee.
Important Disclosure
FT and BAJ will reward your patience.
I have a 140000 share block thats been for sale at 2.4 for three weeks. All or none. When it gets close to it the selling pours in. If it was going to move next week or the week after it would be gone by now.
A whole new board would be fine with me.
For NYBOB;question for you. Will you try to look into this for me ? Last summer I was in Canada to look at a couple of mines that I have a large position in. While on a train I was having 4 or 5 Big Oranges in the club car.I struck up a conversation with a French Floozie. During the course of our conversation she asked what was in my portfolio. When I mentioned GG she got all excited and said don't sell that one. She went on to tell me that GG had bought up a whole town in canada to move it out of the way to make room for a major gold mine. Thats all I know and everone I ask seems to know less than I do. THE OLD GUY
Cars cars cars everybody thinks cars. There are 20 million electric bicycles in China. They now add 3 million per year and can't keep up with demand. They are powered by Lead acid batteries. The average life of a battery is 3 to 7 years. Each battery contains 20 lbs of lead. You do the math and you will understand why the Lead price is up 500 % . The biggest by
product of a silver mine is ? you guessed it, Lead. You now know why the price of lead is not comming down too soon. You also now know something that maybe one in one hundred thousand investors knows. Good luck with your investments. THE OLD GUY
To mining guy; in regards to post 9. DUH: What part of FT, BAJ and CZN didn't you understand. I thought you would ask about the Lead use in bicycles. Have a nice day. THE OLD GUY
To mineing guy: Scorpio fits my profile of what I like to buy. A property with lots of undrilled anomalies. Enough proven reserves to start an operation.Good experienced team with the ability to raise the capital needed to put it into production. And it has to happen in 2 to 3 years. You will find these same characteristics in all of my major plays. Copper ,Cobalt play BAJ. There is much work beinging done on new battery technology involveing Cobalt. Bismuth,Cobalt and coal play FT. There is a worldwide shortage of Bismuth and demand exceeds supply.Silver, Lead and Zinc play Czn. Lead acid battery demand almost exceeds supply due to demand from China for bicycles. Also work is being done on fuel cells that use Zink. If you have the patience to sit awhile and like technolgy, look at one of my loosers ICOP. I just sat thru a two hour confrence call where they gave no guidence at all. The fund guys were going crazy. I really like this one.But its going to take some time, I hope not to long. I don't have much left. Feel free to ask me questions on anything. I have lots of time, thats because the ladies don't give me much attention. Next time I will tell you about the fast million I lost in natural gas stocks over the last two years. Yes I don't win them all. BEST OF LUCK THE OLD GUY
To mineing guy, I will tell you why IDSM is now in play. Its the reason you must pay attention to all your stocks. The fundamentals change. I now own mineing stocks in only four countries, and there are only three more that I would consider.In too many of them they are close to taking them away or they have raised the royalties to obscene levels. Back to IDSM The biggest supplier of graphite was China. It was so cheap you could not compete. But it was made from crude oil. Now the price of crude has gone up 500%, labor has doubled and freight has tripled. The fundamentals have changed. There fore IDSM is now in play. THE OLD GUY
OK Scorpio is an old ASARCO mine. Years ago Asarco owned about a dozen mines, they were than taken over by a Mexican company. At that time the Mexican goverment changed the laws. To operate a mine in Mexico you had to have a partner that was Mexican and he had to have 51 % of the stock. Ha Ha HA AS the price of metals were falling the 51 % people did not want to put money into a decling asset. They are very short term orientated. So many of the smaller mines were closed.Most mineing in Mexico went into disrepair or ended all together. They than changed the laws so you didn't need a 51 % Mexican partner. Things started to pick up again. Along came the China boom and the debasing of currencies all around the world. The precious metal boom was on its way and things took off. The reasons this stock is so low are many.First of all we have three basic types of plays. The moose pasture the proven up but not into production, and thoes in production. The money flows into then this way. The moose get all the gambling money. The producers get all the big money. The Scorpios get whats left over or the long term money thats in for the long time. All the mineing stocks would be much higher by now except for one big thing. ( because of this big thing you have a chance to get into many good plays that would be priced much much higher then they are right now ) The last time around we did not have the ETFS. They have taken billions out of the market for mineing stocks. Yes they have there place. But more money will still be made picking the right stocks. Four months ago, I told all who would listen to buy GG. It was at 24 or 25 and I said it would go to 38. That was 50 %. If you bought the gold ETFS, you made a nice profit. But no where near 50%. I'm tired now more later. THE OLD GUY
Doublon is a jerk. He is missing the whole point of dialog. which is, YOU NEVER LEARN ANYTHING WHEN YOUR DOING THE TALKING. I want to hear everything about anything. It broadens my world and gives me new perspectives.
To mining guy and all others. Its late and I be 92. My typeings bad and spelling is worse. I will tell you a lot tommorow. But as for what you look for in a minning stock its tonnage.Its so expensive to open a hole these days that its got to be big. You can find gold in every cubic foot of seawater, but you can't recover it and make a profit. 95 % of all the little mining stocks that you can find will never go into operation. Scorpio should be in operation in 6 months. I am looking for 5 dollars in 12 months and at least 10.00 in 24 months. When you look at any companies drill reports, the width or hight of the core sample is of most importance. Good numbers and one foot wide will never beat numbers that only 20 % as good but 20 feet wide. THE OLD GUY
Go to the I- HUB site SPM I will answer your questions there. THE OLD GUY
If your looking for a silver filling, do some D&D on this one. I sold enough GG to buy this on the premise that GG will double in a year while this one will triple. Posted by: oldguy
In reply to: None Date:11/5/2007 1:10:05 PM
Post #of 54961
Off topic. I like this board and the people on it. I wish them all good fortune. Here is a recent post of mine. I hope it helps allPosted by: oldguy
In reply to: miningguy2004 who wrote msg# 98 Date:10/23/2007 1:11:00 PM
Post #of 101
Take a look at ca:spm scorpio mining. I have just added 40000 shares to my postion making it 100000. They are getting close to production. This is an old ascarco mine that I am very familar with. I liked it 25 years ago and even more now. There figures are based on a 1000 ton per day mill, but I know that property can easily support a 2000 ton mill. It is a huge property with upwards of 20 anomalys. They have only drilled four of them. Best of luck. THE OLD GUY
. Please do your own D&D. Best of luck. THE OLD GUY
le this one will triple.
Off topic. I like this board and the people on it. I wish them all good fortune. Here is a recent post of mine. I hope it helps allPosted by: oldguy
In reply to: miningguy2004 who wrote msg# 98 Date:10/23/2007 1:11:00 PM
Post #of 101
Take a look at ca:spm scorpio mining. I have just added 40000 shares to my postion making it 100000. They are getting close to production. This is an old ascarco mine that I am very familar with. I liked it 25 years ago and even more now. There figures are based on a 1000 ton per day mill, but I know that property can easily support a 2000 ton mill. It is a huge property with upwards of 20 anomalys. They have only drilled four of them. Best of luck. THE OLD GUY
. Please do your own D&D. Best of luck. THE OLD GUY
We might be better off if STANTON were involved.Then the stock might be four cents instead of two. Wow, thats a 100 percent jump.