Thanks VH, Nice reply. Cancelled Warrants seem to be the Key.....

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mulac1

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19/06/16

21:22

Post #: 18069156
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Originally posted by Value_Hunter ↑

Mulac,

what you say is "correct" .....however:

1. the stock draw from the LME has basically ended up on the SHFE (473k, down to 389+/-, while the SHFE has gone from 30Kt to 99Kt).
2. "interestingly" ALL of the SHFE metal is "held" on warrant.......Diesel has posted a nice link to SHFE data.
3. over the last 2 months or so - the "ave" draw from LME is around 15-20Kt / month
4. during this same period - cancelled warrants has fallen.......

to me - the market is quite happy to sell metal from the LME (ie no tightness yet apparent).

if / when we see increasingly cancelled warrents, and continued falling inventories, then we will see a "tightening" in the futures markets....im not sure exactly where this point is, but it is "interesting" to note that there has been a few large block sales in our major Nickel plays (WSA / IGO)........to me - this means the big end of town is slowly getting set in the quality names.

Gavin - the +ve thing is the market has moved from surplus to deficit .........
imho - its going to take a bit more time to eat a bit more of the stockpile. MCR management at least realise this, and have done something that could potentially generate enough cash to get throu the restart capex cycle. If they can actually achieve this - it would be truly remarkable (as every other Ni play has diluted holders......).

we should hear some news on additional Au drilling, plus the feasibility study in the near term. . MCR already has a small fleet of trucks....and has an ok relationship with a major gold miner to the North (whose mill has excess capacity). realistically, with minimal work they should book > 500K Oz, so 5-8 yrs at 50K Oz would be a great little cash generator !

since that Banks report, a larger producer went broke (MBN), and s32 has indicated it may shut a Fe-Ni plant......

should be +ve (when we finally) get to the other side !

rgds
V_H

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Thanks VH,

Nice reply.

Cancelled Warrants seem to be the Key.. Also how transparent is the SHFE?

It seems that now is the time to get set for a Ni rebound (and maybe also copper)

Cheers
M1

MCR Price at posting: 28.5¢ Sentiment: Buy Disclosure: Held
1 Upvote

0 Great analysis

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Thanks VH, Nice reply. Cancelled Warrants seem to be the Key.....

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