Posted by AGORACOM-JC
at 3:19 PM on Thursday, February 13th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
It is a well-known rule of thumb that the safe haven asset class
which includes gold typically trades with an inverse correlation to
equities. There is an exception to that rule, and that is when the
Federal Reserve eases their monetary policy with low rates and the
accumulation of assets on their balance sheet to provide liquidity. This
is because that action is considered bullish for both gold and U.S.
equities. It seems that in this instance there is a unique divergence in
the way gold and U.S. equities have reacted to statements made today by
the Federal Reserve’s Chairman Jerome Powell.
In the run-up of 2008 to 2011 we had both U.S. equities and gold
running to all-time record highs in unison as the Federal Reserve began
their quantitative easing programs. Statements made by Chairman Jerome
Powell up until today have been emphatic in his explanation of the slow
and steady accumulation of $60 billion in assets each month not being a
new round of quantitative easing.
That defensive posture and explanation by the chairman changed today
when Chairman Powell said that the “central bank would use quantitative
easing as a tool against the next economic downturn.†Although he did
not go as far as saying that the recent asset accumulation was in any
way a form of quantitative easing, today’s statement opens the door to
increase asset accumulations aggressively if needed.
According to MarketWatch, “In testimony before the Senate Banking
Committee, Powell said the Fed had two recession-fighting tools; buying
government bonds, known as QE, and communicating clearly with markets
about interest-rate policy, routinely considered as “forward guidance.
We will use those tools — I believe we will use them aggressively should
the need arise to do so.â€
His testimony occurred on the same day that the U.S. Treasury
announced that they recorded a $33 billion budget deficit in January.
Analysts at Reuters forecasted that the deficit would only increase by
11.5 billion last year. More alarming than the underestimate by analysts
was the fact a year ago the treasury announced a budget surplus of $9
billion.
U.S. equities all traded in record territory today is a direct result
of data suggesting that there is a slowdown in the number of new cases
of the coronavirus, now labeled as COVID-19 by the CDC. The Dow Jones
Industrial Average gained 275 points today, and closed at a new all-time
record high of 29,55.42. The NASDAQ composite also surged to a new
all-time high of 9725.96, and the S&P 500 get a new record high at
3379.75.
At the same time, we saw gold trad fractionally lower on the day. As
of 5 PM EST is currently trading down $1.30 and fixed at $1569 per
ounce. With the exception of palladium all the other precious metals did
close lower. However once again palladium was able to buck the trend as
it gained over $63 in trading today and is currently fixed at $2329.
According to a report by Johnson Matthey one of the largest precious
metals refiners in the world said that the palladium market “was in a
supply/demand deficit of more than 1 million ounces in 2019, and the
shortage is expected to be even worse in 2020.â€
If the report by Johnson Matthey is accurate it could signal much
higher prices and the possibility of palladium reaching as high as $2700
per ounce this year.
For those who would like more information, simply use this link.
Tags: clean energy, CSE, palladium, PGM, PGM Demand Posted in New Age Metals | Comments Off on #Palladium rising while gold remains flat – SPONSOR: New Age Metals $NAM.ca $WG.ca $XTM.ca $WM.ca $PDL.ca $GLEN
Posted by AGORACOM-JC
at 10:46 AM on Wednesday, February 12th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
PGM demand, prices likely to remain high this year
After resurgent demand pushed the platinum market into deficit in 2019, with the total volume of platinum under investment coming in at a record 3.4-million ounces at the start of this year, speciality chemicals company Johnson Matthey says the platinum market could move back into surplus this year unless investor appetites are sustained.
Last year, more than one-million platinum ounces were added to
exchange-traded fund holdings, outweighing a contraction in global
industrial and automotive demand, as well as a double-digit drop in the
Chinese platinum jewellery market.
Johnson Matthey notes in its latest ‘Platinum Group Metals (PGM)
Market’ report that demand for platinum this year will be supported by
rising PGM loadings on heavy-duty trucks in China and India, where
stricter emissions legislation is due to be implemented.
However, it notes that this will be offset by a further erosion in
platinum jewellery demand and a drop in purchases by the glass sector.
“With weaker primary supplies balanced by further growth in
autocatalyst recycling, investment will again be the primary factor
which determines the direction of market balance.
Platinum supplies in 2020 could fall below six-million ounces for the
first time in six years, reflecting the impact of ongoing
rationalisation programmes in South Africa, a lower contribution from
the release of excess pipeline stocks and the depletion of PGM-rich
surface materials that have supported PGMs output at Norilsk Nickel’s
operations in recent years.
AUTOCATALYST DEMAND
Johnson Matthey explains that while autocatalyst recycling is
expected to rise again this year, it will, at best, offset the decline
in primary supplies.
Recent growth in platinum recoveries reflects the dramatic expansion
in platinum use in diesel catalysts that occurred between 2000 and 2007.
Platinum consumption in light-duty vehicles peaked at around
3.5-million ounces in 2006 and 2007, but fell steeply during the global
financial crisis in 2008; thereafter demand was also affected by falling
diesel vehicle registrations and increased use of palladium in diesel
catalyst systems.
Platinum recycling volumes are expected to reach a plateau in the next few years.
Combined platinum demand in the autocatalyst, industrial and
jewellery sectors is not expected to change much this year. On balance,
Johnson Matthey believes combined demand in these “consumingâ€
applications is more likely to fall than to rise, but this will depend
on factors such as vehicle production volumes and the timing of
industrial platinum purchases for new chemical, glass and petroleum
refining plants.
“In the light-duty diesel market, production volumes will be the
principal factor determining the direction of platinum demand,†Johnson
Matthey notes.
THE CASE FOR PALLADIUM
All-time highs were recorded in the palladium price last year as the
market deficit widened to more than one-million ounces – demand reached
an all-time high of 9.7-million ounces, despite demand for palladium
falling in industrial applications.
Johnson Matthey says that intensifying use of palladium in gasoline
cars in Europe and China pushed auto demand to a record level, despite
lower vehicle output. It adds that the tightening emission legislation
and stricter vehicle testing regimes are driving up the PGMs content of
three-way catalysts in most major vehicle markets.
The palladium deficit is likely to deepen this year, as an increasing
number of Chinese and European vehicles meet China 6 and Euro 6D
legislation, respectively. This is expected to drive up global average
loadings on gasoline catalysts and could lift world automotive demand
above ten-million ounces.
Although secondary recoveries from spent catalytic converters will
continue to rise, primary supplies may fall slightly, reflecting
rationalisation at South African mines and the depletion of
palladium-rich surface materials at Norilsk Nickel.
Johnson Matthey notes that while the market remains in significant
deficit, prices are likely to remain strong, stimulating efforts to
thrift and substitute palladium where possible, and incentivising the
mobilisation of market stocks.
RHODIUM
Rhodium moved into a modest deficit last year, as a small rise in
combined supplies was not enough to meet a 10% increase in total demand.
Global consumption of rhodium on autocatalysts leapt by nearly 15% in
2019, following a step-change in loadings in Chinese vehicles.
Johnson Matthey says car companies in other regions also used more
rhodium, in response to tighter emissions standards and more stringent
testing.
“These gains offset a sharp fall in rhodium use in the glass
industry, as capacity expansion slowed after two years of exceptionally
strong activity.
“Although combined primary and secondary supplies rose by 2%, this
was not enough to prevent the market moving into deficit,†the chemicals
company explains.
The outlook for 2020 is a deepening market deficit with further
strong gains expected in autocatalyst demand, albeit at a slower rate
than last year.
Tags: clean energy, CSE, palladium, PGM, PGM Demand, stocks Posted in New Age Metals | Comments Off on #PGM demand, prices likely to remain high this year #Palladium #Platinum SPONSOR: New Age Metals $NAM.ca $WG.ca $XTM.ca $WM.ca $PDL.ca $GLEN
Posted by AGORACOM-JC
at 12:15 PM on Tuesday, February 11th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
Palladium, Tesla and the Imposition of Electric Vehicles
What underlies the tremendous runup in the price of Palladium and now the giant spike in Tesla stock? They are connected.
Tesla stock has spiked despite its self-driving cars doing strange things like running people over and spontaneously combusting.
By: Clive P. Maund
What underlies the tremendous runup in the price of Palladium and now
the giant spike in Tesla stock? They are connected. Tesla stock has
spiked despite its self-driving cars doing strange things like running
people over and spontaneously combusting. The reason for this is the
relentless drive towards electric cars which will result in a massive
increase in demand for palladium and electric car manufacturers like
Tesla becoming mainstream.
The elites have a Master Plan to push ordinary motorists off the road
and back onto public transport, and they will realize this by using the
environmental scare to effectively outlaw petrol driven cars and force a
transfer to expensive electric cars, which will be out of reach of many
motorists because of their cost. Greta is a pawn in this game. The
means by which they will outlaw petrol (and diesel) driven cars is to
class carbon dioxide as an emission, which they have already done, and
then make the emissions standards tighter and tighter until petrol
driven cars are forced off the road. Since anything that burns anything
creates carbon dioxide, which is essentially an inert natural gas, it is
clear that petrol driven cars cannot reduce their carbon dioxide
emissions to zero, so their fate is already sealed. You may be asking
what is the motivation for doing this. There are a number of reasons.
One is to reduce the profligate consumption of oil by the masses for
their personal transportation and the resulting pollution. Another is
control – a public who lack personal transportation and the freedom it
brings are of course easier to control and direct. Lastly it will free
up the roads for the elites, who will suffer less from delays caused by
traffic congestion resulting from the masses on the move, since they,
the elites, will always be able to afford private vehicles, no matter
what they cost. The masses will not resist this transformation of their
lives. First of all they are ignorant and have no idea of the plans for
them that are already at an advanced stage. Secondly, they are too cowed
and docile to do anything about it even if they did know. Now that you
know what is set out above, you should be able to readily appreciate why
the price of palladium, and of Tesla stock, have been soaring. Let’s
now proceed to look at their extraordinary charts. Starting with
palladium, we see on its long-term 20-year chart that after essentially
tracking sideways for many years, the phase of accelerated advance
really didn’t begin until mid-2018, and it was only later in 2018 that
it broke out above its highs way back in 2001. So the dramatic
acceleration in its rate of advance has been going on for 18 months or
less.
We can see the period of accelerated advance in more detail on
the 5-year chart, and how the point of origin of the accelerating
parabolic uptrend is at the start of 2016. The price only cleared the
resistance at the 2001 highs in the $1080 area as recently as late 2018
and it is only over the past 6 months or so that we have seen dramatic
acceleration. This chart makes clear that as the price has now run way
ahead of its parabolic supporting uptrend, there is plenty of room for
it to correct back or consolidate without breaking down from the
uptrend, although it could well spike even higher from here, with
speculation now rampant.
On the 6-month chart we can see that at the recent peak volume
became really heavy, which puts us on notice that even if this wasn’t
the top for this run, a top may not be far off.
Turning now to Tesla, we can see that it has suddenly gone
vertical in recent weeks, which implies that the age of the electric
vehicle is almost upon us. Even so, this move looks extreme, especially
on long-term charts and suggests that a reaction back or period of
consolidation is now likely over the short-term.
Modern cars have become a nightmare of over-regulation and
control and it’s going to get a lot worse. They got rid of ignition keys
so that you now have a push button start and have to pay for very
expensive key fobs. All modern cars look the same because of draconian
regulations regarding impacts and safety, and they are all designed in
the same wind tunnel. For unknown reasons – probably bigger profits for
the manufacturers – most cars are the same standard colors. “You can
have any color you like sir, as long as its black, red, silver or
white.†The core of the car is too heavy for safety reasons and is
compensated for by flimsy bodywork, in order to meet fuel consumption
targets. Bumpers, which used to be designed to take impacts with no
damage or resulting cost, are now made of delicate painted structures
which cost a fortune to fix after even the slightest impact, but that’s
no problem because the insurance covers it, except that this means
raised insurance premiums. You can’t turn the engine off and open the
door and listen to the radio on a hot day, because either it switches it
off or starts making stupid bleeping noises. Some new cars switch the
engine off every time you come to a stop, and you have to be at a dead
stop to put it in gear etc. Your location is always known because the
car is computerized and online, which incidentally means that it is
theoretically possible to hack the car remotely and cause it to crash,
by say, locking the brakes. For this reason also you can never be sure
that any conversation you have in the car is private – they could be
broadcasting it live in the Superbowl stadium. Even for a 100 meter trip
down the road the baby or child has to be strapped into a child seat.
The list is endless and the future is going to be even worse. Rear view
mirrors are going to be swapped for cameras that display on the central
screen, so if anything goes wrong with it you have an expensive
replacement of the entire system. There are going to be cameras mounted
on /in the dash that monitor your facial expressions and if you look
drunk or tired, the onboard computer will seize control of the car and
force it to pull over. Likewise your days of breaking speed limits are
over, since the car won’t let you. No wonder teens are not interested in
cars anymore – you won’t hear any of them saying told my girl I had to forget her, rather buy me a new carburetor.
Posted by AGORACOM-JC
at 4:58 PM on Monday, February 10th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
Palladium Wave Analysis 10 February, 2019
Palladium reversed from support area
Likely to rise to 2400.00
Palladium recently reversed up from the support zone located between
the key level 2155.00 (low of the previous short-term correction 4),
lower daily Bollinger Band and the 38.2% Fibonacci correction of the
pervious upward impulse 3 from December.
The upward reversal from this support area created the daily Japanese candlesticks reversal pattern Hammer.
Palladium is likely to rise further toward the next resistance level 2400.00 (top of the pervious impulse waves 3 and (i)).
Posted by AGORACOM
at 3:00 PM on Friday, February 7th, 2020
SPONSOR: New Age Metals Inc. The company owns one of North America’s largest primary platinum group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an additional 1,059,000 PdEq Ounces Inferred. Learn More.
Summary
The palladium market will remain tight and pressure prices higher.
Sibanye Gold with the Stillwater Mine has plunged back into SA.
The Aberdene palladium ETF and Canadian palladium juniors are the best proxies.
Palladium has been the best performing commodity in the past two
years or so, jumping over 100% and there is more to go. This palladium
bull market is much different than the last one. The bull market from
1997 to 2000 was about 3 years and then palladium dropped giving up most
of the gains in less than a year. There was a nice bump up from the
2008 crisis and then the price traded sideways for several years. The
price bottomed at the end of 2015 with the severe bear market in
precious metals. Since then, the price has been going steadily higher
with a major break out in 2016. This bull market is not going to end
anytime soon for the reasons below.
Palladium is mostly used in the auto industry for pollution control
with catalytic converters. Electric vehicles will be a long time coming
to replace any significant amount of gasoline/diesel driven vehicles.
Meanwhile, pollution standards are being tightened that will keep demand
high. China has been gobbling up palladium since their China 5
pollution standards took effect in 2013. China 6 will now be coming into effect that will increase loads per vehicle of palladium. Many analysts have been commenting that China has been secretly stock piling the metal and is driving prices.
Palladium demand by Sector
There is no doubt the demand will remain strong, but the real
story is on the supply side. This next graphic illustrates the supply
deficit since 2016.
It is obvious to expect an increased demand from China as pollution regulations are tightened with ‘China 6’.
This next graphic of global mine production is very important because of the palladium supply is in a very unstable region.
The Russian supply from Norilsk Nickel has always been quite stable
and is of no concern, but as investors, we cannot participate there.
South Africa is the other big producer and that country is becoming very
unstable and more worrisome, that is where most of the future reserves
are.
The world’s largest PMG reserves are in South Africa, precisely in
the Bushveld Complex (in the central-Northern part of the country) which
alone accounts for about 50% of the world’s palladium resources, but,
overall, South Africa has reserves of 63 million kilograms which
represent over 91% of the worldwide availability.
South African (SA) mines have always been plagued with labour issues,
strikes, and high costs. To make matters worse, the country is now
facing an energy crisis with rolling blackouts shutting down mines. The country will probably become much more unstable, with unemployment hitting 10-year highs.
Half of their youth are unemployed and the company that provides 95% of
the electricity (when it can) is reporting record financial losses.
This is a country teetering on the brink of chaos that will likely be
very disruptive to PGM mine supply. I am avoiding palladium and platinum investments there.
With all the issues in SA, Sibanye Gold (SBGL)
began diversifying out of the country and acquired the Stillwater PGM
mine in the US. That use to be my favourite stock to play palladium bull
markets. However, they jumped right back into the fray, acquiring
Lonmin in 2019, a struggling SA, PGM producer. They promptly cut 5,000
jobs at the mine and it now appears Sibanye is moving more into PGMs
from gold. According to what was released in the acquisition news,
Sibanye PGM production will increase from around 1.7M ounces per year
to 2.8M ounces/year. This compares to about 600,000 ounces/year at the
US Stillwater complex plus about 700,000 ounces produced through the
recycling unit, noted from the 2018 annual report.
SA PGM production was 627,991 ounces (this will increase significantly with Lonmin acquisition)
SA gold production was 344,752 ounces (this amount is well below normal because of mine strike)
US PGM production was 284,773 ounces
US PGM recycling was 421,450 ounces
The stock has done well with the rising palladium price, but at these
stock prices and the move back to SA, it has become too risky. I would
suggest selling at these prices.
To highlight risks further, the Q1 2019 financial report highlights a -63% decline in SA gold production in Q1 2019 compared to Q1 201 because of the labour strike. This news out on February 2nd
states that 19 attacks on SA gold facilities nearly doubled from last
year. On December 15, 2019, attackers took hostages and plundered the
smelting plant at Gold Fields Ltd.‘s South Deep mine. “Mining companies are being attacked by thugs and armed gangs and there is a lack of police response,” said Neal Froneman, CEO of Sibanye Gold Ltd., which repelled an attack on its Cooke mine two weeks ago. “It eventually has a knock-on impact into society, it’s lawlessness, it’s anarchy.”
There is the Aberdeen Standard Physical Palladium ETF Trust (PALL).
The investment objective of the Trust is for the Shares to reflect the
performance of the price of palladium, less the expenses of the Trust’s
operations. The ETF Trust physically holds palladium in JPMorgan vaults
in London and Zurich. PALL tracks the movements in palladium spot prices
fairly well and is the best direct exposure to palladium. Aberdeen
purchased the fund effective October 1, 2018, from ETF Securities. The
Aberdeen website is terrible, it just diverts you to something else they
are trying to sell. You can find some more info at etf.com.
One disadvantage, as a Trust it will often trade at a discount to NAV, so short term may not always reflect palladium movements precisely.
The chart of PALL reveals quite a jump in volume on the last rally. I
do not find this alarming, but shows it is really the first time the
palladium market has caught retail interest.
If we compare to the short-term chart on palladium below, it is easy
to see that PALL has tracked the palladium price very well. After a
needed correction, the price jumped higher on Monday. This is probably a
start to the next rally.
There is also Sprott Physical Platinum and Palladium Trust (SPPP), but it is split 50/50 between the two metals.
Canada is the third-largest producing country, so an obvious place to
look. A lot of the palladium production comes from major miners in the
Sudbury nickel/copper complex as a byproduct. Obviously, this is a good
area to look and there was an excellent proxy for investors called North
American Palladium that was operating the Lac Des Isles palladium mine.
Unfortunately, for us, investors, it was bought out last year by SA producer Implats.
The area had a number of discoveries back in the last bull market
around the year 2000, and I visited a number of those projects back
then. I believe the best one in this area is Canadian Palladium that acquired the East Bull project last year. There is also Palladium One that is not Canada but not in SA either.
Palladium One Mining (OTC:NKORF) – PGM project is in Finland.
Shares outstanding 111 million, 185 million fully diluted
Their LK project is located in north-central Finland, approximately
40 km north of the company’s exploration office in the town of
Taivalkoski. The property is 160 km (by road) east-southeast of
Rovaniemi and 190 km northeast of the port city of Oulu. Finland is a
very stable jurisdiction and has a viable mining sector.
The company is run by CEO/President, Derrick Weyrauch, CPA, CA who is
an experienced mining executive and corporate director. Mr. Weyrauch’s
background includes finance, risk management, corporate restructuring
and turnarounds, coupled with M&A strategy development, execution
and post transaction integration. He is the co-founder of Magna Mining
Corp. and is a former corporate director of a number of companies
including Eco Oro Minerals Corp., Jaguar Mining Inc., and Banro Corp.
and is a former CFO of Jaguar Mining Inc. and Andina Minerals Inc.
Currently, he is a non-executive director and at Cabral Gold Inc.
The LK Project is 100% owned by Palladium One Mining Inc.
Palladium One released a mineral resource estimate for the Kaukua deposit within the 100-per-cent-owned Lantinen Koillismaa (LK) project.
Highlights:
An optimized pit-constrained mineral resource, at a 0.3-g/t palladium cut-off;
635,600 PdEq (palladium equivalent) ounces of indicated resources grading 1.80 g/t PdEq contained in 11 million tonnes;
525,800 PdEq ounces of inferred resources grading 1.50 g/t PdEq contained in 11 million tonnes.
Significant potential exists to expand the historic Haukiaho
deposit along strike both to the east and west. For example, 1960s-era
historic drilling by Outokumpu about two km east of the historic 2013
Haukiaho inferred resource returned up to 36.36 m grading 0.20 per cent
Cu and 0.19 per cent Ni from 1.64 m to 38.00 m downhole in hole R692 (no
PGE analysis was conducted). Reconnaissance prospecting by Palladium
One in the vicinity of this historic drill hole returned up to 0.51 per
cent Cu, 0.33 per cent Ni, 0.19 g/t Pt, 0.56 g/t Pd and 0.21 g/t Au
(0.96 g/t PGE) (see press release dated Aug. 12, 2019). Palladium one
recently applied for the Haukiaho East reservation (see press release
date Sept. 5, 2019), which, if approved, the company would control about
24 km of the favourable Haukiaho basal contact.”
The company plans to conduct
a 75-line-kilometre induced polarization (IP) geophysical program,
along with a diamond drilling program of up to 5,000 metres, at the LK
project. Both drilling and geophysics contractor are expected to be
mandated soon.
The Tyko Ni-Cu-PGE project, i65km northeast of Marathon Ontario, Canada.
The Tyko project is an early stage, high sulphide tenor, nickel
focused project with recent drill hole intercepts returning up to 1.06 Ni over 6.22 m including 4.71% Ni over 0.87m in hole TK-16-010 (see press release dated June 8, 2016). On January 21, 2019, Palladium One reported prospecting samples with assay results of up to 0.74% Ni, 4.09% Cu, and 2.51g/t PGE
on the Tyko Nickel-Copper-PGE Property. This project has some
palladium, but if it is developed to a resource, it will be more like
the Sudbury copper and nickel mines with PGMs as a byproduct.
The company is well financed, closing a C$3,786,180 private placement
at C$0.06 per unit issuing 63,102,999 units. Eric Sprott took down
20,000,000 units. While funding is required, this is quite a bit of
dilution.
Currently, the stock is priced around $0.18 so all the warrants and
options are well in the money. So is appropriate to use the fully
diluted shares outstanding for valuation.
Market cap – $20 million. Market cap fully diluted Cdn $33.3 million
Subtracting $3.8 million financing from the market cap, it values
their 635,600 PdEq indicated resource at C$25 per ounce and fully
diluted at C$46 per ounce. This is a quite low valuation.
The stock mostly trades on the TSXV symbol (PDM), so I used the C$
chart. Support is around 16 cents and 12.5 cents. If 16 cents holds, the
stock could begin a leg higher.
Canadian Palladium
Shares outstanding 100.3 million approx.
All warrants and options are at 30 cents and higher.
What I consider one of the most important highlights is the company
is run by Wayne Tisdale. In the last 10 years, he has advanced three
juniors and sold them for large profits for their shareholders. He
helped start and finance the Rainy River project which was sold to NewGold in 2013 for $310 million. He developed US Cobalt and, in 2018, sold it to First Cobalt in a transaction worth $150 million to his shareholders’ delight. Going back further, he helped finance oil & gas company Ryland Oil that was bought out by Crescent Point in 2010 for a $121.8 million
valuation. Mr. Tisdale has a keen eye to find projects that can quickly
be advanced further to make them prime acquisition targets. Canadian
Palladium only has a market value now of about C$20 million, and I have
little doubt that Mr. Tisdale is going to do it again with Canadian Palladium.
Highlights:
Company run by Wayne Tisdale
Low market valuation – C$31 per ounce
East Bull with 43-101, 523,000 inferred palladium equivalent resource
East Bull can open to depth and along strike
Widely spaced drilling only needs infill drilling to upgrade and expand resource
Close to Sudbury complex where ore can be processed
Projects – East Bull, Ontario Canada
East Bull was drilled by Freewest and Mustang Minerals back in the
2000 era and now has a 43-101, 523,000 ounces inferred palladium
equivalent resource. A private company, Pavey Ark Minerals had the
property and in 2017 they twinned old drill holes and completed the work
to bring the project to 43-101 standards. Canadian Palladium (formerly
21C Metals) acquired a 100% option on the project last February.
This graphic from their presentation is a good summary and shows the location
In the 1999, 2000 period, Freewest drilled 27 holes for a total of
2,902 meters and carried out extensive surface trenching. Work by
Mustang on the eastern part of the Property (claim 1227910) included 11
drill holes for a total of 1,766 meters. The work by Freewest and
Mustang forms the majority of the data for the current resource
estimate. Additionally, Pavey Ark reviewed and re-sampled drill core
from the 27 BQ and NQ holes from the Freewest drilling program. Pavey
Ark’s exploration results in 2017 included;
hole EB17-01 that intersected 12.0 m at 2.87 g/t PGM+Au, 0.23% Cu and 0.13% Ni and
hole EB17-03 that intersected 7.0 m of 3.21 g/t PGM+Au, 0.16% Cu and 0.07% Ni.
(Note: Au = gold, Cu = copper, and Ni = nickel.)
In 2019, BULL completed their initial exploration program at East Bull and reported results Sept. 17, 2019.
These are highlights from the first sampling program on the East Bull
palladium project and field program on the Agnew Lake project:
Seventy-three grab samples were selected to help identify the
palladium-bearing rock types of the mineralized trend. Grab samples are
used to determine the presence mineralization and may not be indicative
of the overall grade of the zone
Sampling successfully defined locations for channel sampling and the
higher grades could indicate potential zones within the mineralized
zone for higher-grade starter pits
Range of palladium assay sample results were 37 samples below 0.1
g/t palladium, 17 between 0.1 and 0.5 g/t with 14 above 1 g/t. Nine of
these ran between 2 and 6.5 g/t
Geological mapping and review of the Freewest diamond drilling in
2000, indicates the northeast-trending faults are composed of multiple
intrusions of mafic to diabase dikes. Left lateral movement on the dikes
is measured to be up to 100 metres
This graphic gives a good snapshot of the current resource and
expansion potential. Mineralization starts at surface and the system
appears to be about 30 meters wide. This would be an open-pit operation.
Agnew Lake property
It is located 80 kms. west of Sudbury, Ont., home of Glencore and
Vale’s Canadian nickel-copper-platinum-group-elements mining and
smelting operations. The Agnew Lake property comprises over 260 claims
(about 6,000 hectares) and is part of the larger East Bull Lake-Agnew
Lake mafic-ultramafic complex.
The Agnew Lake magmas have major element compositions that are very
similar to the model parent liquids proposed for the mafic portions of
the Stillwater and Bushveld complexes. The Agnew intrusion and the East
Bull Lake intrusion are also considered to host significant PGE-Cu-Ni
mineralization in marginal rock units (Peck & James, 1990; Peck et
al., 1993a, 1993b, 1995; Vogel et al., 1997).
Financial/Summary
Last financial statements show just over $400,000 cash. The company
just closed a $4 million financing at 12 cents per share. Eric Sprott
bought 12.5 million shares of that financing.
Wayne Tisdale has been successful in financing and increasing the
value of properties and dealing them off for large profits. I believe he
will do it again and also has a loyal following of shareholders from
his past success. BULL just acquired the property last year and there
has been little exploration and no drilling so it has been under the
radar until the recent financing. The discovery is on the surface, so
will be cheap to mine and is close to the Sudbury complex where refiners
can recover PGMs. There is a couple other palladium exploration plays
in Canada, but they are mostly old stale stories and I believe none have
the short-term potential that the East Bull project has.
The current market cap is $20.1 Million less the $4 million financing
gives an enterprise value of C$31 per ounce on their 523,000-ounce
Pd-eq inferred resource. Part of the reason for the low value is the
resource is only inferred. If drilling success starts to prove larger
potential and the resource moves up to the measured and indicated
category it could easily increase the value potential.
Only exploration news last year was sample results that came out last
September just when the junior market started heading south. The stock
made a decent move higher than just drifted lower until a typical
year-end bottom. The stock took off when it hit 12 cents on good volume.
This is when they began marketing a financing that was way
oversubscribed in one day. Probably spill over buying drove the stock up
to the 23-cent level. The stock then came back to support around 16
cents and bounced off higher. Drill news will likely cause the next move
higher with the old highs around 27 cents last year as the first major
resistance.
Conclusion
A recent update on palladium by TD Securities
highlights tightening emission controls and South Africa as I have, but
most interesting is the lack of speculative trading positions. TD
comments positions held by traders are below average. This rally has
room to move and if excessive speculation builds it could go way higher.
Regardless of whether palladium is $1,200 or $2,400 per ounce,
palladium discoveries and deposits will be worth premium valuations,
especially in stable jurisdictions. The potential for discoveries in
South Africa is very good but the political risks are rising. Ivanhoe
Mines (OTCQX:IVPAF), Eastplats, and Platinum Group Metals (PLG)
have projects in SA, and if I had to pick one there, it would be
Platinum Group Metals because they have the most leverage to platinum
and palladium prices.
The best direct related investment to palladium is the PALL ETF, but
it does not offer any leverage. There are not any 2 times or 3 times
palladium ETFs. This leaves the best leverage to junior palladium
companies and there are few. I prefer those outside of SA like Canadian
Palladium and Palladium One. I prefer Canadian Palladium because of the
CEO’s track record, their resource is on surface, near PGM smelters and
likely cheaper exploration costs in Canada vs Finland. For
diversification, owning more than one palladium play is not a bad idea.
Disclosure: I am/we are long DCNNF. I wrote
this article myself, and it expresses my own opinions. I am not
receiving compensation for it (other than from Seeking Alpha). I have no
business relationship with any company whose stock is mentioned in this
article.
Additional disclosure: Canadian Palladium is a paid advertiser at affiliate playstocks.net
Posted by AGORACOM-JC
at 2:48 PM on Tuesday, February 4th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
Anglo American chief ‘surprised’ by palladium bull market
The bull market in palladium has come as a surprise to the chief executive of Anglo American, one of the world’s biggest producers of the metal.
In an interview with the Financial Times, Mark Cutifani said he had not anticipated the barnstorming performance of palladium, which has surged 75 per cent over the past year to around $2,400 an ounce.
“Am I surprised prices have risen to this degree? Yes. And the reason
is I thought there would be more substitution [from carmakers] back to
platinum,†he said. “It will still happen over time. I have not changed
my view. What I underestimated, very clearly, was the focus on the
automakers have on making sure they manage emissions.â€
In March 2018 Mr Cutifani said the rapid rise in the precious metal’s
price has created a “bubble†but that its value was likely to remain
high for some time. At that point palladium was trading at around $1,350
an ounce. The price subsequently rose as high as $2,555 before dropping
back to about $2,400 today.
Palladium is a vital ingredient in catalysts for petrol and hybrid
cars that convert toxic emissions such as carbon monoxide and nitrogen
oxide to carbon dioxide, water and nitrogen. Demand for the metal has
increased due to tightening emission standards in the automotive
industry, particularly in China, that require more of it to be used in
car catalysts.
“The way I put it, the CEO of an auto company won’t get fired for
spending $20 on a vehicle on a bit more palladium. What they might get
fired for is not meeting their emissions targets. That’s the critical
issue,†said Mr Cutifani. After nearly a decade of undersupply the
market is now critically short of palladium and scrambling to find new
sources of supply.
It has also sparked a crime wave with thieves in London jacking up
cars to steal the catalytic converters, which are then sold to scrap
metal dealers for cash. Production of palladium is constrained because
it is mined as a byproduct of platinum and nickel — commodities where
new projects have been few and far between.
“What people are learning is that you can’t just turn its [supply] on
and off. It’s not a flick of the switch. Mines take a long time to
develop. Now, are we reacting, yes . . . but it takes a bit of time.â€
Additional reporting by Harry Dempsey in London.
Posted by AGORACOM-JC
at 4:24 PM on Monday, February 3rd, 2020
Eric Sprott announces that, today, 2176423 Ontario Ltd., a corporation which is beneficially owned by him, acquired ownership of 14,000,000 units of New Age Metals Inc.,
At a price of $0.05 per share for aggregate consideration of $700,000
Toronto, Ontario–(February 3, 2020) – Eric Sprott announces that, today, 2176423 Ontario Ltd., a corporation which is beneficially owned by him, acquired ownership of 14,000,000 units of New Age Metals Inc., pursuant to a private placement, at a price of $0.05 per share for aggregate consideration of $700,000. Each unit consists of one common share and one common share purchase warrant. Each whole warrant entitles the holder to acquire one common share at an exercise price of $0.10 per share for a period of two years.
Mr. Sprott now beneficially owns and controls 14,000,000 common
shares and 14,000,000 common share purchase warrants of New Age Metals
(representing approximately 10.2% of the outstanding shares on a non
diluted basis and approximately 18.6% on a partially diluted basis).
Prior to the acquisition, Mr. Sprott did not beneficially own or control
any shares of New Age Metals Inc.
The units were acquired by Mr. Sprott, through 2176423 Ontario for
investment purposes. Mr. Sprott has a long-term view of the investment
and may acquire additional securities of New Age Metals including on the
open market or through private acquisitions or sell securities of New
Age Metals including on the open market or through private dispositions
in the future depending on market conditions, reformulation of plans
and/or other relevant factors.
New Age Metals is located at Suite 101-2148 West 38th Avenue,
Vancouver, BC V6M 1R9. A copy of 2176423 Ontario’s early warning report
will appear on New Age Metals profile on SEDAR at www.sedar.com
and may also be obtained by calling Mr. Sprott’s office (416) 945-3294
(200 Bay Street, Suite 2600, Royal Bank Plaza, South Tower, Toronto,
Ontario M5J 2J1).
Posted by AGORACOM-JC
at 8:48 AM on Monday, February 3rd, 2020
Closed a fully subscribed private placement of 40 million units for aggregate gross proceeds of $2-million managed by IBK Capital Corp.
February 3, 2020 – Rockport, ON, Canada – New Age Metals Inc. (the “Company”) (TSXV:NAM); (OTC:NMTLF); (FSE:P7J) has closed a fully subscribed private placement of 40 million units for aggregate gross proceeds of $2-million managed by IBK Capital Corp. Each Unit consisted of one common share and one common share purchase warrant (“Warrant”), where each Warrant entitles the holder to purchase one additional common share at a price of $0.10 per share for a period of two (2) years from the date of closing.
In connection with the closing, the Company
paid fees to IBK Capital Corp. in the amount of $104,000 in cash and
issued 3,300,000 broker warrants. The Company also paid fees to Mackie
Research Capital Corporation in the amount of $28,000 in cash and issued
700,000 broker warrants. Each broker warrant is exercisable into a unit
under the same terms as the private placement.
New Age Metals is pleased to announce that
Eric Sprott, through 2176423 Ontario Ltd., has purchased $700,000 of the
fully subscribed private placement. A new insider was created in
connection with the financing. 2176423 Ontario Ltd. (a company
beneficially owned by Eric Sprott) purchased 14,000,000 units of the
Company representing approximately 18.56% of the Company’s current
issued and outstanding shares on a post conversion beneficial ownership
basis. Prior to his purchase, 2176423 Ontario Ltd. (Eric Sprott) did not
beneficially own or control any securities of the Company. The Units
were acquired for investment purposes.
Harry Barr, Chairman and Chief
Executive Officer of New Age Metals, reports: “We are very pleased to
have Eric Sprott as a partner of New Age Metals Inc. His record of
success is quite simply unmatched.”
The gross proceeds of this financing will
be used to develop the Company’s 100-per-cent owned River Valley
palladium project, located 60 miles from the Sudbury metallurgical
complex in Sudbury, Ontario.
All securities issued in connection with
the private placement are subject to regulatory approval and are subject
to a four month plus one day hold period expiring on June 4, 2020, in
accordance with applicable Securities Laws.
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If you have not done so already, we encourage you to sign up on our website (www.newagemetals.com) to receive our updated news or click here.
About NAM
New Age
Metals is a junior mineral exploration and development company focused
on the discovery, exploration and development of green metal projects in
North America. The Company has two divisions; a Platinum
Group Metals division and a Lithium/Rare Element division. The PGM
division includes the 100% owned River Valley Project, one of North
Americas largest undeveloped Platinum Group Metals Projects, situated
100 kilometers from Sudbury, Ontario as well as the Genesis PGM Project
in Alaska. The Lithium division is the largest mineral claim holder in
the Winnipeg River Pegmatite Field where the Company is exploring for
hard rock lithium and various rare elements such as tantalum and
rubidium. Our philosophy is to be a project generator with the objective
of optioning our projects with major and junior mining companies
through to production. New Age Metals is a junior resource company on the TSX Venture Exchange, trading symbol NAM, OTCQB: NMTLF; FSE: P7J with 96,843,766 shares issued to date.
Investors
are invited to visit the New Age Metals website at www.newagemetals.com
where they can review the company and its corporate activities. For further information any questions or comments can be directed to [email protected] or Harry Barr at [email protected] or Cody Hunt at [email protected] or call 613 659 2773.
On behalf of the Board of Directors
“Harry Barr”
Harry G. Barr, Chairman and CEO
Neither the TSX Venture Exchange nor
its Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Cautionary Note Regarding Forward
Looking Statements: This release contains forward-looking statements
that involve risks and uncertainties. These statements may differ
materially from actual future events or results and are based on current
expectations or beliefs. For this purpose, statements of historical
fact may be deemed to be forward-looking statements. In addition,
forward-looking statements include statements in which the Company uses
words such as “continue”, “efforts”, “expect”, “believe”, “anticipate”,
“confident”, “intend”, “strategy”, “plan”, “will”, “estimate”,
“project”, “goal”, “target”, “prospects”, “optimistic” or similar
expressions. These statements by their nature involve risks and
uncertainties, and actual results may differ materially depending on a
variety of important factors, including, among others, the Company’s
ability and continuation of efforts to timely and completely make
available adequate current public information, additional or different
regulatory and legal requirements and restrictions that may be imposed,
and other factors as may be discussed in the documents filed by the
Company on SEDAR (www.sedar.com), including the most recent reports that
identify important risk factors that could cause actual results to
differ from those contained in the forward-looking statements. The
Company does not undertake any obligation to review or confirm analysts’
expectations or estimates or to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.
Investors should not place undue reliance on forward-looking statements.
Copyright (c) 2020 TheNewswire – All rights reserved.
Posted by AGORACOM-JC
at 3:44 PM on Thursday, January 30th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
Palladium to remain strong despite added Nornickel supply – analysts
Prices are likely to remain strong despite news that Russian producer Norilsk Nickel will release three metric tons of palladium ingots from its stockpiles, traders and analysts said.
(Kitco News) – Palladium
prices are likely to remain strong despite news that Russian producer
Norilsk Nickel will release three metric tons of palladium ingots from
its stockpiles, traders and analysts said.
As of 10:22 a.m. EST, spot palladium was up 17% so far in 2020 and
trading at $2,261.10 an ounce. The metal hit a record of $2,556.95 on
Jan. 20, with market watchers citing strong demand for automotive
catalysts, particularly as countries like China increase regulations on
emissions, which requires more use of platinum group metals.
Norilsk Nickel, the world’s largest producer of palladium, said
Wednesday that its Global Palladium Fund would deliver three tons of
ingots from its current stocks. A Nornickel official told Reuters that
the company is concerned about higher borrowing and hedging costs, since
the lack of ingots has led to higher lease rates, backwardation and
market volatility.
“That [Nornickel action] would certainly lend some temporary relief …
to the lease-rates markets,†said one desk trader of platinum group
metals. Otherwise, he said, rates have been in the double digits.
“Along with that, you would expect to see some price reaction to the downside.â€
But if so, this likely would only be temporary, he continued.
“I still believe that the long-term fundamentals – being what they are – still point to stronger palladium prices.â€
The trader later added, “I think a lot of people view Russia as
steady suppliers to the palladium market anyway. This is probably not
too out of the ordinary in them shifting forms in how they supply the
market, based on where the demand is. They’re probably getting a premium
for it. So why wouldn’t they shift?â€
TD Securities also sees potential for further gains in palladium prices despite the Nornickel news.
“While this will tighten the sponge discount, we do not see this
reversing the years of chronic deficits in the market,†TDS said in a
research note. “Considering this rally has been much more fundamentally
driven, and demand is set to structurally increase … the path of least
resistance remains to the upside for palladium in 2020.â€
Earlier this week, analysts with Bank of America Securities said they
see palladium soaring as high as $3,500 an ounce before the rally ends.
At the same time, demand is strong as mine supply has been falling
since 2004, Bank of America said.
Posted by AGORACOM-JC
at 5:08 PM on Tuesday, January 28th, 2020
SPONSOR: New Age Metals Inc.
The company owns one of North America’s largest primary platinum
group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral
Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an
additional 1,059,000 PdEq Ounces Inferred. Learn More.
Why Palladium Is on a Tear
Story behind palladium’s move is that a physical shortage has developed in London
Traders sold metal they didn’t physically possess
Now they are being asked to deliver the bars and they are scrambling to secure the metal needed, bidding prices higher
Physical palladium and rhodium markets are buzzing. Reported prices for both metals leapt higher in recent days.
The story behind palladium’s move is that a physical shortage has
developed in London. Traders sold metal they didn’t physically possess.
Now they are being asked to deliver the bars and they are scrambling to
secure the metal needed, bidding prices higher.
It looks like bullion bankers selling paper metal are finally getting
called for selling way more than they can actually deliver!
People have complained about this practice in precious metals markets for decades.
More and more contracts have been sold, but inventories of actual
physical metal have not kept pace. Price discovery is broken when the
paper price of metal is detached from physical supply-and-demand
fundamentals.
Today, there are hundreds of paper ounces floating around for every ounce of physical metal eligible for actual delivery.
As soon as a few contract holders lose confidence in their ability to
redeem the paper for actual metal, the jig is up. The rush for physical
bars will drain exchange vaults quickly and anyone still holding paper
when the music stops will be out of luck.
That may be happening now in the market for palladium.
Sellers with an obligation to deliver physical metal can lease bars,
rather than purchase them. But that is now a very expensive proposition.
Lease rates spiked to near 30% last week in London.
Lessees must promise to return the quantity leased plus 30% in additional palladium ounces.
New Cautions on Rhodium
Rhodium prices have surged along with palladium. Price discovery in
rhodium works differently than for other precious metals, so investors
need to be especially careful.
The “spot†price for rhodium surged to $9,985 last week. However,
that price does not come from a market where regular trading produces
live, real-time prices.
Rather, the rhodium ask price is simply declared by major refiners. Johnson Matthey is one of the firms which publishes a price.
The price is generally updated twice per day during the trading week.
Lately the published ask prices jumped dramatically higher. Bid prices, on the other hand, have not kept up.
The bid/ask spread in the thinly traded rhodium market has always
been wider than in other precious metals, but it’s wider now than ever.
Current bids are roughly $2,000 below the published ask price.
If there really are industrial users paying the refiners’ $10,000 ask
price for physical rhodium, it is quite an opportunity for arbitrage.
Traders could theoretically purchase bars at the bid price and sell them
at a very healthy profit to anyone paying the ask price.
That isn’t happening, at least as far as we can determine. Someone
may have published a $10,000 ask price, but we can’t locate anyone
actually paying that sum for rhodium bars. Despite what the surging “spot†price for rhodium may imply, the bid for physical rhodium remains weak.
Money Metals has taken dozens of calls per day from sellers trying to
cash in on spot prices near $10,000/oz. Many are disappointed to find
actual prices are far lower which is a result of wholesalers dropping
their bids. We believe one major rhodium buyer will cease further buying
soon.
The rhodium market is tiny and illiquid. Price discrepancies like the
one we are seeing are common. Our advice to clients would be not to put
much credence in the “spot†price they see published until the spread
is much tighter than it currently is.
The true price of rhodium, like all assets, is based on what real
buyers are actually paying. That is currently closer to $8,000/oz, not
$10,000/oz.
