#Manganese Strategic for #EV Battery. Seriously We Really Need This. #Ukraine #Russia Covets.

Manganese is a hard brittal silvery metal often found with Iron ore Deposits. Found inconveniently in Ukraine, Australia, India, China, Gabon and Brazil.

The Metal is absolutely essential to EV Batteries. If we do not source enough of this metal the EV Battery and EV Car business will flounder. Traditionally also used in Steel Making and in trace amounts for nutritional needs.

Ukraine as at 2010 was thought to have 140 million tons of proven reserves. The Nikopol Manganese Basin runs from Bulgaria through Southern Ukraine to Georgia.

Symbol Mn. Atomic Number is 25 and this could be one of the reasons why #Putin wants to control Ukraine. Russia is based on minerals and raw materials. It’s thinking permeates all manner of logic.

Written from a “Caveat Emptor Perspective”

#Palladium, #Putins Strategic Revenge How #Russia will Screw Cars. $PALL, $SPPP, #EV, $TSLA, $F, $GMC, $TM,

Palladium continues to climb to nosebleed levels. Not followed as closely as Gold or Silver it has more impact on western economies particularly the car and environmental businesses.

50% of Palladian is used in Catalytic converters where 90% of harmful gases are converted to harmless substances. Clearly the western world needs Palladium.

Here is how a very frustrated Putin will lash back at the west. Some 40% of the world supply comes from a Russian Mine in Norilsk Kola Peninsula just a stones throw from Finland and Norway.

So expect Vladimir to suspend Palladium exports and watch the western economies roil. All is fair in love and war. We are not in love. Curtailment of air travel into and out of Russia is not helpful in this case.

So auto’s that are negatively impacted by 0.13 cent chips will have catalytic converter problems.

All is not lost it will just be very expensive. Other regions that produce Palladium are Bushveld Igneous Complex in Transvaal South Africa, Stillwater Complex in Montana and the Canadians produce out of the Sudbury Basin and Thunder Bay Districts.

Palladium is also used in Fuel Cells reacting with Hydrogen and Oxygen producing Electricity, Heat and Water. all very useful outcomes.

For the scientifically inclined Palladium is known as the Chemical element Pd. Atomic Number 46.

#Gold Will Geo-Politics Hurt. Inflation? $GLD, $GDX #Russia, #Ukraine

Gold has done well lately driven by Geo-Political Headlines that usually contain the words Russia, Ukraine, Putin or combinations thereof. Gold seems to be reasserting itself as a store of value. Crypto not doing well BTW.

How much longer will Geo-Politics drive Gold? Which way will it drive? Will it drive the wrong way onto ongoing lanes?

At the time of writing the whole world was holding their breath waiting for a Russian invasion of Ukraine. War and conflict drives Gold upwards. Putin is quite prepared to let the world hold their breath and turn blue as a Smurf. It makes him feel powerful.

The whole Ukraine thing will have ongoing ramifications. Putin will eventually invade complaining no one respects Russia’s security concerns. Currently there are sharp exchanges of small arms fire in the separatist regions. They are moving civilians out of these regions into Russia to avoid civilian casualties. Also allows Russia more flexibility to maneuver. The civilian removal diminishes western Intelligence as there were many quiet assets reporting troops movements.

Putin is frustrated and is now exercising his missile forces. We all know these missiles work. He is rattling a bigger sabre. Signalling he is perhaps prepared to up the ante. For Putin there is no losing you just double down and keep going.

This intransigent mindset will guarantee long term ego-political problems. Ukraine will not roll over. They will be constantly resupplied by the west. If Putin uses 250,000 troops given Ukraines geography that equates to two acres per Russian soldier to occupy and keep pacified. Not feasible. Russia will bleed badly. Putin will resort to increasingly desperate measures.

Ergo geo-political risk will continue to drive the price of Gold upwards. The media will provide a steady drum beat of headlines.

Western inflation does not go away as currencies are debased to fight Covid. Thank You China and the incompetence of Wuhan political leadership.

Written from a “Caveat Emptor Perspective”

#Barrick #Gold $GOLD You’ve come a long way Baby.

Barrick announced stellar results. They are primed for perfection. Not that long ago they were disappointing. Big debts. Hedged so as not to realize value as a Gold company. There was an arrogant whiff to the company which management begging to be replaced. And they were.

Today represents three years and 12 quarters of increasing returns for shareholders. They will increase the dividend and buy back US$ 1 Billion of shares which is about 2.5% of market cap.

They also are about to benefit from a secular bull market in gold. This will only increase their valuations. Problem property in Nevada fixed and contributing nicely. They think they will produce 4.4 million oz of gold in 2022.

They figure prominently in GDX Vanecks Gold ETF as well as other Gold ETF’s. They are in a position to do something quite big. How big? BIG. What can go wrong? They have a reputation for shrewdness which is well deserved. They own in whole or part four of the top ten gold properties in the world. The largest is run by Uzbekistan. The third largest is run by the Russians so good luck getting into those deals.

So what are the Black Swans? So far they seem far away if they do exist. Thats when they are at their worst when they seem far away.

To speculate here are a few possibilities.

Environmental activists rock the boat and hamper or God Forbid shut down operations. The resource is there and we can’t exploit it economically. The Green movement is well organized. Some contend that’s were the extreme left wing hides out.

Geo-political conflict making it impossible to operate one or more mines. Can Barrick hire enough kick-ass mercenaries to protect itself?

Bear-Raid by Russia or China or both and others to drive down price of Gold while they load up. Could Barrick survive Rogue National interests. Certainly a gut punch or two but for how long.

Strategically all great general make great mistakes. Napoleon, Caesar and the rest of them have had a bad day or two. Barrick is not immune to a mis-step. No management system is bullet proof.

In the meantime Barrick stock should do well attracting both retail and institutional attention. Didn’t one of Warren Buffett lieutenants once buy into this stock. Short lived as it was probably a good idea that the old guy couldn’t figure out. The Stock will run and most will outstay the party trying to lick the punch bowl.

What goes up must come down.

Written from a “Caveat Emptor Perspective”

#Hashtag Power #Gold, #OIL, #Silver, #Tesla

Social Media thrives on Hashtag power. Currently there are approximately 92 million hashtags of varying influence. The top 100 do not seem to have anything to do with mining, business or even politics.

#GOLD ranks at 280. However it can also relate to many non mining categories. Currently Twitter automatically attaches an icon of a gold medal..

#Silver comes in at 948. Same comments as for Gold including icon.

#OIL clocks in at 2,996

#Copper 5,204

#Platinum ranks at 6,643

#Gas gets to 8,367

#Tesla registers at 7,624

#Cobalt shows up at 58,953

#Lithium is at 83, 910

#Nickel 118, 187

#Uranium 205,991

#LNG 218,184

#NatGas 608,979

So as we freak about geo-politics and commodity shortages lots of the world is naive and ignorant too wrapped up in their own useless Tic-Tok videos.

Just in case you were trying to understand something.

Written from a “Caveat Emptor Perspective”

#China and #Russia will screw #US #Cobalt Achilles Heel of #EV $TSLA, $F, $GMC, $TMC, $OIL, #Kongo

Cobalt is the mother’s milk of EV batteries. Like many EV materials Cobalt is in short supply and increasingly expensive. EV battery makers are experimenting with different levels of Cobalt but its still integral.

When mined it’s a pretty blue. As a matter of fact there is a colour called Cobalt arising from the attractive colour of the metal. Cobalt is frequently found with Nickel which in itself is also relatively rare.

The social and geo-political issue is approximately 60% of Cobalt comes from DR Congo or as it used to be called Kongo. Not exactly a bastion of liberal democratic values. Child labour accusations run rampant. To no avail. Kongo continues to stutter along and produce Cobalt most of which is spoken for by the Chinese. Surprise. Glencore has interests in two mines. Other mines operated by state owned entities have near opaque accounting. The only discipline they have is payment for product. Other matters be damned.

Russia is the number two producer of Cobalt. Ambiguous at best of times. As Russia does not have an effective EV effort they will sell wholesale to their strategic best friend China. The Russian miner Norilsk Nickel has one of the top five mines.

Is your skin starting to crawl a little.

Australia holds down third position. Usually friendly to the west. Cobalt is produced as a by product of its copper-nickel deposits. Friendly to the west but not naive as to market price.

Phillip new comes in fourth position. They are Asia’s top nickel producer but suffer from very erratic political direction. If America can regain former influence you might be able to put this one in the west’s column.

Cuba is fifth. Geographically close to the US but in bed with China. The mine is operated by Sherritt an long tenured Canadian Mining company that has been a burr under the American Saddle. Sherritt will probably do well financially as Cuba sells Cobalt to China. The sooner the old Castro remnants are flushed out the better. This one can easily be brought into the western Column. The mine is in Moa region in the province of Holguin in Eastern Cuba on its northern shore. The processing plant is named after. Wait for it. “Che Guevara.

Canada clocks in at the sixth position. Long a big producer of Nickel their are many junior miners feverishly exploring for Cobalt in the traditional nickel producing areas in Northern Ontario, They even have a town called Cobalt. The resource to watch will be Vale’s big nickel property in Voisey Bay in Labrador. Politically stable. Vale has sold royalties.

Of note in mid 2018 Wheaton Precious Metals paid $390 Million. in return from Jan 2021 they will receive 42.4% of refined Cobalt until they reach 31 million pounds at which time their take drops to 21.2%. Readers and investors should note Wheaton is taking the mineral not the current cash equivalent. Quite the long position. Assume there will be secured maybe bonded warehouse in Voisey Bay. Yields were down in 2021 because of Covid issues

Papua New Guinea comes in at seventh position. Paula has nickel resources and cobalt is a by product. Much of the cobalt has been royaltied off to Cobalt 27.

China finally shows its head in the eight position . Accounts for 70% of world refined cobalt which is mainly imported from Kongo. Domestic resources are not impressive but because of EV it is the world’s top consumer of Cobalt. Supplies from Kongo can be easily interdicted by the west.

Morocco which is conveniently close to Europe is the ninth ranked producer. BMW (read Germany) has announced that it will source Cobalt from both Morocco and Australia. Count this one in the western column.

South Africa comes in the tenth position. It is a by product of Copper and Nickel. The Nkomati Mine is a JV with Russia’s Norilsk Nickel. This can be easily interdicted if push came to shove.

So easy to say despite the brilliance of Elon Musk and GM’s Maria Barra come from behind surge, we are controlled, constrained and manipulated by availability of Cobalt.

Written from a “Caveat Emptor Perspective”

#Russia #Sanctions Alert Will these #ADR Get Slaughtered. #Aeroflot, #Gazprom, #Norilsk, #Lukoil, #Yandex

There are approximately 15 ADR of Russian companies trading on American Stock Exchanges. They will receive a bullet to the head shortly. Probably delisted or seized in some fashion. So if you have not already sold this might be a very good time to liquidate whatever is left and get out of Dodge.

To help jog memories here is a list of some of the more notable companies just in case you were wondering

Aeroflot Russian Airlines. $AERZY

Gasprom NFT. $GZPFY

Norilsk Nickel $NILSY

Lukoil $LUKOY

Rushydro $$RSHYY

Primorski Shipping $APSKY

Yandex $YNDX

OZON Holdings $OZON

CIAN $CIAN

Michelle Steel $MTL

Mobile Telesystems $MBB

QIWI $QIWI

Mosenergo $ADOMOY

PJSC Gasprom $OGZPY

There are others but you get the drift. Not only dead money; but losing money tied up in nothing but problems.

Written from a “Caveat Emptor Perspective”

#Gold Royalties Where to Find these Tasty Investments $FNV, $WPM, $TFPM

Investing in Gold and Precious Metals by way of streaming companies is growing in popularity. You avoid the normal headaches of an operating company. Your royalty company should have very low overheads.

Most royalty companies are very diversified over dozens if not hundreds of assets. Some assets are already cash producing other assets are in the development pipeline ranging anywhere from moose pasture to a mine in actual construction. This will dramatically affect when cash flow materializes. Geographical diversification is usually quite broad.

Given that Royalty Stocks just like any stock are the present value of future earnings you need to understand the timing of your roadmap. I can’t emphasize how important this point is.

Valuations are also affected by the market price of the commodity. If Gold spot trades at $1,800 that’s one thing. If gold goes up to say $2,2200 that’s a very better thing. You, the miner and the royalty company have no control over the underlying value of the metal. So God Dam-it just hang on. It’s a ride with volatility, risk and excellent returns God Willing.

I’ll briefly go through some of the top royalty companies which can be easily purchased through any brokerage account. They trade during normally stock market trading hours and usually have a deep liquidity which can satisfy the largest of investors.

1. Franco-Nevada $FNV on NYSE seems to be the current Grand Daddy. Market Cap of $28.5 Billion. Portfolio is spread over 58 Gold and Equivalent Assets, 55 Energy Assets, 42 advanced stage Gold and equivalent assets and some 27 exploration stage assets. 70% exposure to Gold, 11% Silver, 8% Energy and 2% other.

Yield is about 0.98%. Currently trading around $139 with a 52 week hi-low of $163.79 to $105.62. Just declared a dividend increase of 6.7%. They have 15 years of annual dividend increases in case you are asking. Canadian Investors in the 2007 IPO are receiving a 10.7% yield on initial investment. “That is tasty”

2. Wheaton Precious Minerals $WPM on NYSE is number 2 with a market cap of $22 Billion. 90% of assets are from the America’s, 75% of assets are in the lowest cost quartile. They are exposed to Gold 60%. Silver 36% and 4% Platinum. They have a big royalty to come on Cobalt from Vale’s Voisey Bay asset in Labrador Canada. Cobalt is almost 70% concentrated in the Congo which is geo-politically suspect at best of times. From Voisey Bay they will receive 42.4% of cobalt production until delivery of 31 Million pounds and 21.2% thereafter for life of mine.

Yield is 1.47%. Currently trading around $41.75 with a 52 week Hi-low $49.10 to $34.85. Lots of precious metal investors are happy with this one.

3. Osisko Gold Royalty $OR on NYSE comes in with a market cap of $2.0 Billion. Trading at about $11.82 So there is quite a market cap drop from the first two to third position.. Portfolio covers 150 Royalty Streams, on 17 Producing Assets 75 Development Projects and 103 Exploration projects. Very leveraged to future potential. What’s your risk appetite.

4. Labrador Iron Ore $LIFZF with a market cap of $2.1 Billion trading on OTC Markets at around $33.57. Yield of 14.92%. 52 week Hi-Low of $42.40 to $26.61. Not Gold but still a powerhouse. Question about the dividend yield safety. This is a do your own due diligence moment.

5 Sandstorm Gold $SAND market cap $1.7 Billion trading at $6.25 on NYSE. Yield is 1% and 52 week Hi-Low is $9.31 to $5.31 Portfolio covers 220 precious metal, base metal and Diamond Assets. They cover 24 producing assets, 25 Development stage, 18 advanced exploration and 152 exploration assets.

Sandstorm is 58% North American, 18% South American, 9% Africa and 8% Asia. Their anchor asset is “Had Malden Gold/Copper Property” in NE Turkey. Once in production this asset is expected to double Sandstone Attributable Production.. Seems to have leverage but this is Gold Mining in an unstable part of the world. Risk on big time. Put an asterisk by this one.

6. Maverick Metals $MMX on NYSE Market Cap $823 Million. Portfolio covers 115 Royalties in 18 countries. 13 are paying and 19 are advanced stage exploration. 53% in USA, 30% in Mexico, 9% in Canada and 5% in Mexico.

Interesting shareholder base consists of Newmont $NEM 30%, Pan-American Silvers $PAAS 18%, Kinross Gold $KGC 8% Mgmt. and Others 8%

They have 51 royalties with Newmont. 24 Royalties with Kinross, 11 royalties with Pam-American Silver and 11 royalties with Gold Field $GFI.

7. Altius Market Cap about $635 Million $ATUSF at about $15.21 on Nasdaq. Portfolio covers 13 producing assets in America’s. They have a 0.3% NSR on $Vale Voisey Bay Labrador Canada property with Nickel, Copper, Cobalt.

8. Nomad Royalty Market Cap $490 Billion $NSR on NYSE has 14 Royalties onStreams and or Gold Loans over 6 producing mines. 80% of cash flow comes from gold assets. No dividend yield. 52 week Hi-Low $31.85 to $23.18.

Interesting shareholder base consists of Orion Mine Finance 70.2%, Yamana Gold 7.8%, Mgmt. and Insiders about 2%.

9.Metalla Royalty. Market Cap of $400 Million, $MTA on NYSE trading at about $6.56. Currently yields 0.37% with a 52 week Hi-Low of of $10.98 to $6.00 . Their portfolio covers 60 gold and silver assets. 5 of which are producing, 23 in development stage and 41 in exploration stage. Lots of potential but when.

10. EMX Royalty Market Cap of $294 Million $EMX trading at about $2.05 on NYSE. No yield. 52 week Hi-Low $3.69 to $1.85. Their portfolio covers Precious Metals, Base Metals and EV. They have 60 royalties in Canada and US, 17 in Scandinavia, 20 South America & Caribbean, 6 Turkey, 3 in Serbia and 2 in Australia.

11. Late Comer onto the field that is starting to make some noise. Triple Flag Precious Metals $TFPM.TO trades around CDN $ 16.01. They yield 1.59 % 52 week Hi-Low is 19.90 to $10.50. Market Cap of $2.5 Billion. They focus on cash producing and or fully permitted construction ready projects. They have 75 Assets with 9 streams and 66 royalties. 15 are producing and 60 in development or exploration.

This company has been referred to as the Next Franco Nevada but at the ground floor level. Yield seems to be the best off a robust Market Cap. Will eventually seek US Listing with obvious advantages.

Hope this provides some guidance to Royalty and Streaming Investments.

Written from a “Caveat Emptor Perspective”

How to Tell When #Russia invades #Ukraine

During the first Gulf War the Pentagon was criticized for the large amounts of personnel working at night with office lights on noticeable to any passerby. Also a large amount of pizza delivery was ordered. Clearly a security breach. Kuwait is 8 hrs different to Washington DC Time Zone wise. Midnight Kuwait is 16:00 in Washington DC. Problem cleared up in the second round. American Military learned from their mistakes.

What about the Russians. Moscow has a one hour difference from Kyiv. Midnight Moscow is 23:00 local time in Kyiv. Not much of a difference. Similar to New York City and Chicago.

Russian Defence Ministry is similar to the Pentagon. Thats were all the uniformed Big Shots work. Google Maps marks it as “Znamenka Ulitsa 19, Moscow Russia 119019” Anglicized that means 19 Znamenka Street in Moscow. Will we see more activity there at all sorts of odd hours. If you wear a uniform you are used to working all hours around the clock. But you will need to turn on the lights, eat, and otherwise function.

Same thing with the Kremlin. Will a few windows show late night light when otherwise there is none. I’m sure intelligence and satellite photography looks for these activity patterns.

Both facilities must be fitted to allow personnel to eat, sleep and work 24 hours per day. So activity patterns of egress and entrance will be keys as well. When there is a war it’s not 9 to 5.

So message to commercial satellite photography assets train your camera’s here as well. Tanks and artillery are important but this is where the brains reside.

Written from a “Caveat Emptor Perspective”

Kick-Ass Ways to Invest in #Gold and Precious Metals $GLD, $IAU, $GDX, $SIL

Many ways to invest in Gold and Precious Metals. Many investors use a combination depending on their personalities and demeanour. If Gold and Precious metals rise in price most if not all boats will float rather nicely. So what’s the difference?

Many die hard Gold Bugs like to take physical possession. They want their coins and bars in their personal control. They usually have bought safes and dug very deep holes in the back yard. Or maybe somewhere in the countryside where no one can see.

An ounce of Gold is an ounce of Gold. Even if you have to rub a little bit of soil off of it. These guys frequently are avid Second Amendment Advocates and own firearms because they are concerned about other things. Not going to argue with the socio-political perspective. But if it comes down to that can you use a bar of Gold or Silver to buy Goods or Services.

Certainly coins can be used but will you have enough in small enough denominations so you don’t get cheated on the change. It will take a certain amount of intelligence to know gold values. Will undisciplined rabble be able to price Gold properly. Thats where the guns come in. In the meantime buying small denomination Gold coins costs a premium. Not like fiat currency. Five one dollar bills is the same as one five dollar bill. Know what i mean.

Jewelry usually has such a design and retail mark up. So its not a good way to invest compared to other mediums. True but a hard sell to girlfriends and wives. In some cases all of the above. But I digress.

That leaves a world loosely referred to as paper Gold. You can buy ETF’s with underlying gold, silver or precious metals hidden in a secure vault and fully accounted for. If you believe in a metal but do not want any operating risk from a corporate miner that’s a big option. The ETF’s trade like stocks during more or less the same trading hours. They track the underlying metal very closely.

So if your views about inflation, interest rates, government spending, geo-political risk and what not are well informed this may be a very good option. Taking short or long positions depending on your risk profile might be just the thing. Just price risk and nothing else.

Several Gold ETF style options available. In US Dollars there is $GLD which is the SPDR Gold Share Fund trading on NYSE. Market Cap about $44 Billion give or take. Also worthy of note is $IAU which is the iShares Gold Trust. Market Cap $33.5 Billion give or take. Trading on NYSEArca.

Both very liquid. Many other funds also exist which are smaller. Watch for management fees. These guys should just sell or buy Gold depending on the flow. You don’t have to be that smart. Therefore fees should be low. There are funds which trade in other currencies such as Canadian or Australian Dollars, Euro’s and Sterling. I imagine there are options in Swiss Francs as well.

Ready to step out the risk curve. There’s the miners themselves. Some are incredibly large, diversified and well financed. Some are juniors and are very risky. What’s your cup of poison some will say.

The Miners break down into various categories. The large producing miners such as say a Barrick or Agnico-Eagle operate like any manufacturer or processing company. They have raw costs such as labour, transportation, energy, capital expenditures and so on. The excavate and then sell the mineral.

The difference between the two prices is gross profit. Then overheads and the usual corporate nonsense needs to be factored in. Currently the industry has rationalized to a great extent and producers are very cash flow positive. As corporates they look attractive to many other investments. But most people shy away because of perceived commodity risk. I have never heard of a Gold Mine with unsold Gold inventory at the end of business.

There are probably over one hundred gold mining companies which makes for a crowded field. VanEck Vectors has two publicly traded funds $GDX for senior miners and $GDXJ for the more junior list. Deep liquidity for both. Trades like a stock whenever market is open.

Like anything there are differences amongst Gold Producers. Mines have estimated useful lives. Geologists work hard to economically extend them but the inevitable happens. You play out the resource. Stock prices are the present value of all future earnings so look at the remaining life or resources.

Some producers will be spending large trying to improve cash flow either by buying resources, or stepping out and extending deposits. This can be very expensive and while it maybe ultimately highly profitable the pain will be today.

Gold producers have inherent geo-political risk which they cannot avoid. The mine is where it is. You cannot move it or de-risk it. Some jurisdictions such as Canada. Australia, America and Europe are stable where rule of law applies. Other jurisdictions do not respect law the same way and dictators have sudden cash expenses so they jack up royalties or just help themselves outright. Know where your producers are.

You move up the risk scale and look at intermediate and even small juniors. They have properties that range anywhere from exploration rights, to exploratory drilling, to we found something and need to finance it because its damn expensive up here. There are golden nuggets here if you pardon the pun. But also a lot of pain, anguish, tears, failure, sleepless nights. Know your risk appetite. These will be volatile. If successful they take a long time to develop and bring to market. Buyer beware at all times.

The last major investment medium is buying into Royalty streaming companies. Royalties have been around for a long time but its only recently that several companies have developed royalty streams into investable models.

Essentially a resource company can sell a royalty stream on either currently producing assets or on future assets. This will provide financing that may otherwise have not been available. Debt frequently is not possible. Lenders are very risk adverse. Selling more equity dilutes your existing shareholders. Management usually figures prominently in the shareholder base. Out right sale is not always necessary or advisable.

Royalties can be considered a pawn function except that you typically cannot buy back the asset. The streaming company has numerous advantages. They have no operation risks. They have low overheads themselves. They usually diversify over dozens if not hundreds of assets. Producers typically cannot achieve this diversification.

Streaming companies are not all the same. There are mix difference between Gold, Silver, Copper and other metals. You have the same gel-political risk as the underlying assets. Dictators do steal. Also how many royalties are producing right now and when will the other ones come on stream. How long will you need to wait for cash flow. The best royalty deals are made with the projects that need capital the most and that would be very early stage years away from economic viability.

Some trade in Futures. Some make money. Most get slaughtered from what I can see. I don’t pretend to understand future contracts so I’ll leave it for someone else to explore.

Written from a “Caveat Emptor Perspective”