Advocate News Article

Stellar Resources keen despite weaker tin price

SEAN FORD
1 Sep 2017, 8:35 a.m.
No price worry: A Zeehan tin mining hopeful says prices remain attractive for its project despite easing from a high in November.

CORE BUSINESS: Stellar Resources core samples from the West Coast mining hopeful's Heemskirk tin project at Zeehan. Picture: Lachlan Bennett.
Stellar Resources Limited remains positive about tin’s outlook as well.
“The fundamentals for tin are particularly attractive, with low visible stocks and, according to the International Tin Research Institute, market deficits for the foreseeable future,” Stellar said in its 2016-17 annual report.
The $A tin price is trading in a range from $25,000-30,000, which is an attractive level for the Heemskirk tin project. - Stellar Resources
“Tin demand growth has experienced the same headwinds that all metals have experienced over the last six months.
“However, ITRI anticipates annual growth returning to a trend of 2-3 per cent over the next year, reflecting strength in the chemicals sector, which accounts for 16 per cent of the market, and the growth of energy uses.”
Stellar said the London Metal Exchange tin price improved strongly in the first half of the financial year, reaching a peak of $US22,000 per tonne in November.
Since then, it had traded in a narrow range between $US19,000 and $US21,000.
“The $A tin price is trading in a range from $25,000-30,000, which is an attractive level for the Heemskirk tin project,” the report said.
It said ITRI forecast an increase to $US30,000 by 2020, followed by a return to $US25,000 in the early 2020s.
Stellar hopes to start Heemskirk production in 2019.
“The path to production involves drilling to upgrade the resource, completion of a definitive feasibility study , environmental approval and financing of the project,” the report said.
It said Stellar’s main development strategy involved producing tin concentrate at a Stellar-owned processing plant.
However, it said “third-party processing alternatives are evolving in the region” and would be considered if they were available at a price which would add value to the Heemskirk project.
It said it aimed to find funding partners in the current year to continue exploration around the known mineral resource, before in-fill drilling, metallurgical testing and studies to help preparation of the definitive feasibility study.
Stellar reported a net loss of $682,000 for the year.
The company had cash in hand of $2.9 million on June 30 and no external borrowings.