A Microcap Teaser Solution In Advance !!
(Australian stock exchange CLQ, OTC pinks CTEQF).
CleanTeQ is sure to be the answer to future teasers you will be reading about from resource gurus, To save you all the trouble of solving them, I decided to write this article.
My portfolio was grotesquely overweight in gold and silver positions, and in moments of anxiety I thought it would be a good idea to diversify and take a few positions in something other than gold mines, royalty companies, Mongolian exploration companies, and small-cap copper miners with major operations in the Democratic Republic of Congo.
Thus I made a small speculation in CleanTeQ, solely on the basis that mining titan Robert Friedland was the Chairman, and CleanTeQ was the only resource company I could find that seemed to be in a position to mine scandium, a very rare metal that sells for a couple of thousand dollars a kilo.
My due diligence was so slight that I was embarrassed to emphasize my position to the readers at Stock Gumshoe. We are supposed to study these things a little more than I did for CleanTeQ. And after entering at 50 cents, the stock promptly dropped to 35 cents or so, making me glad that I did not look foolish by publicizing my position.
As the weeks went by, I started to find more information on the company that I should have found out beforehand. This was partly accidental, partly from other Gumshoe readers, and partly from new announcements and company news that occurred after I took a position. But the findings were all very positive, and because the company is so interesting I thought it warranted its own thread apart from the hard asset thread which I moderate.
I have a full long position and high hopes. And I thank Secretsquirrel, Griffin, Larry McKenna, and several others who helped fill in the missing pieces of the puzzle.
Below are my findings, opinions, and summary on CleanTeQ Holdings:
BUSINESS MODEL CleanTeQ is a hybrid company based with three bases: scandium mining and production, cobalt mining and production, and water purification. This seems like an odd combination, but as you will see, it is not. It is a stroke of genius. And I will explain why we should care about scandium and cobalt.
(1) The company is starting production of the Syerston mine, the world’s only scandium mine;
(2) The company will also produce significant amounts of cobalt as a co-product to the scandium;
(3) The company has a large-scale water purification technology, which will target municipalities,
Industrial operations with waste water problems, and mines, which also have water problems
PROSPECTS FOR THE THREE SEGMENTS
(1) Scandium is a very rare metal that usually occurs in only small amounts that are not economical to mine. It is mostly available as a by-product and the market is opaque, usually between private parties. Scandium has very beneficial applications in aerospace, aviation, and technology, but has not been widely applied because there is not a sufficiently reliable supply of it.
(2) Cobalt is essential in many batteries. Lithium gets all the investment press, but a majority of the battery formulations need cobalt, which is rare compared to lithium. Cobalt has a similar supply situation as scandium, it is mostly a by-product and is not commonly a prime mining target in and of itself. But demand for the electric energy market is growing rapidly and cobalt demand is growing and will continue to grow accordingly. Supply chains on cobalt are iffy.
(3) Water purification is a pressing need throughout the world. Cities with lots of people, industrialized places with lots of factories, or mines with waste water, all have a real and pressing need for large scale water purification. I think most people can accept this premise of widespread demand without a lot of documentation.
HOW DO THESE SEGMENTS RELATE TO EACH OTHER ? I cannot get too technical about the water purification technology, but I will try to explain what I understand, and how it relates to the scandium and cobalt operations. They call it Continuous Flow Ionization. Ionization is not a proprietary technology per se, but CleanTeQ has developed a way to implement ionization in a continuous feed, automated loop that improves volume, improves economics, is reasonably priced for installation, and can be custom-modified to specific waste problems. It can be used in conjunction with other filtration techniques. Further, it can be modified TO EXTRACT CERTAIN SUBSTANCES from the feed waste water. This is done by modifying the resins that are used in the ionization process.
Now it so happens that CleanTeQ has developed resins that can extract scandium and cobalt from waste water. So they potentially will have commercial sources of rare metals from the by-product waste of their water purification process !
HOW CLOSE IS THE WATER THING TO REALLY HAPPENING ? It is happening. CleanTeQ has signed a memorandum of understanding with a major Chinese municipality to implement their technology. There is a joint venture, 55% Chinese/45% CleanTeQ. Once the first one is up and working, China has a mind-boggling potential for water purification. For their teeming urban centers and for their mining and industrial locations, shall we say the potential is very large ?
CleanTeQ has 100% of rest of the world. CleanTeQ is closed-mouthed about other commercial sources, but they let on that they have been in contact with the likes of GE, Dow, and other big hitters. They state a pipeline target of $100 million by 2020; I predict they will do much better.
HOW CLOSE IS THE COBALT THING TO REALLY HAPPENING ? Very close. Battery useage is soaring and is the strategic target of many governments, corporations, and environmental groups. Batteries need cobalt.
HOW CLOSE IS THE SCANDIUM THING FROM HAPPENING ? This will take a while because the applications are high tech, with long lead times, and there is only one scandium mine in the world (CleanTeQ’s newly commissioned Syerston mine). CleanTeQ intends to develop the scandium market by being a reliable source of supply, and by driving the price down.
CleanTeQ will have viable margins with scandium prices up to half of current prices.
To give you an idea, the Russians made a few MIGs with scandium/aluminum alloys. They were faster, lighter, stronger. An addition of 0.5% scandium to aviation aluminum strengthens the frame, removes the need for riveting, reduces weight, and makes repairs easier. . The Russians dropped it because of costs; and Boeing and Airbus will not use it without a reliable source of supply. But there is about to be a reliable source of supply: CleanTeQ.
WHAT ABOUT IP PROTECTION ? I believe the IP and know-how moat is sufficient. CleanTeQ holds a perpetual license from a high-level Russian research organization that provided some of the foundation technology. I am not a patent lawyer and a lot of the know-how will be proprietary, not patented. CleanTeQ has been at this for over ten years, I think the barriers to entry are sufficient.
MANAGEMENT Totally a plus. Robert Friedland is the Co-Chairman and CEO, he has 20% of the company, great credibility and clout with the Chinese, and an unbelievable track record in mining. Sam Reggall is the other co-chairman. I know little about him, other than from my observations of him on an Australian investment show that aired last week. He was impressive.
MONEY AND FINANCES I don’t think there is anything at all to worry about. Friedland must be worth billions, the Chinese are in, and the concept has enormous potential.
Sources: as I mentioned, information is scant. My sources were the CleanTeQ website, presentations and and interviews with Friedland and Reggall, and the sketchy information on the brokerage sites. Nothing you cannot find on your own.
Long CleanTeQ
This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.
Clean TeQ wins CRC-P Grant with Partners, Ionic Industries
and Monash University http://clients3.weblink.com.au/pdf/CLQ/01830408.pdf
Issue of Clean TeQ Options
http://clients3.weblink.com.au/pdf/CLQ/01830253.pdf
Hendrix, a big thank you on $IVPAF and $PVG (long both). I just took a starter position in $CTEQF today. I appreciate the research that you put into the names that you post about
You are welcome, I disclosed some additional observations today and have added to my position. Long CleanTeQ
Gumshoe sleuthing on CleanTeQ
Hi everyone. I promised some new information on CleanTeQ this week.
CleanTeQ is a very difficult company to explain, so I will give you the factual punchlines first, and my verbose speculations about why this information is potentially important afterwards.
1. The CleanTeQ proprietary processing method for water purification, called Clean iX, can be used to EFFICIENTLY extract a variety of valuable materials besides cobalt and scandium. Specifically, they state that Clean iX can be used to efficiently extract, in addition to cobalt and scandium: Gold, silver, platinum, palladium, rhodium, iridium, copper, zinc, nickel, , uranium, and several other exotic metals you have probably never heard of, as well as all classes of rare earth elements (light, medium, and heavy weight). The Clean iX method can be used for solutions and slurries. To support this assertion, I notice the BHP has gotten involved with CleanTeQ, BHP is a rather large resource company, in case you don’t know about them. CleanTeQ is also on the radar of TCK Teck Resources, another very large top-tier miner.
2. CleanTeQ is not explicitly disclosing the substantial progress they have made in working with major aerospace companies on vetting scandium alloys as raw material, and CleanTeQ’s production quality for these applications.
They speak in general terms about the need to get the confidence of major players, and there was an announcement almost two years old about a collaboration with Airbus. But the fact is, they have developed very sophisticated applications and prototype products with a subsidiary of Airbus using very advanced manufacturing techniques. In other words, it is not “pie-in-the-sky” to wish for serious interest from the aviation and aerospace industry in scandium alloys. It is a process which is well underway. I predict that there will be an offtake agreement for CleanTeQ scandium production within the year.
3. One of the potential parties to the product development of scandium alloys
is Aleris. Aleris is an private American aluminum firm. Last fall, a Chinese state player made an offer to buy Aleris for about 2.3 billion. The transaction is being reviewed by the US Senate as it has potential national security implications.
4. I listened again to Mr. Friedland’s presentation from about four months ago at a conference in Africa. It was casual, it was good-humored, but he said it loud and clear: “I’m giving all of you in the audience a stock tip. Buy CleanTeQ !”
He did not say, ” We have this-and that quality, we think the deposit is good, we have a PEA that says XYZ rate of return, look at this drill core, our geologists think thus-and-so, blah, blah, blah.”
He said: “BUY THIS STOCK ! I’m giving you a tip !”
5. Recently CleanTeQ has been named with some fancy research institutions in Australia for applied materials research.
****
Any reader has the right to question my sources, but I am not going to reveal them
because they are sitting there on public sources you can verify for yourself. There is not a confusing plethora of information on the web about CleanTeQ,
so you can verify my assertions without a lot of effort.
To give you an idea how little is out there, one of my blog posts comes up on the first page of the web search results.
****
What do these things mean ?
POINT ONE, material extraction: This means that in addition to being a scandium producer, a cobalt producer, and a water purification company, CleanTeQ will be a
source for revolutionary mining technology. And they are going to partner, JV, and participate in the best projects. This is a stated policy. And Friedland already has the attention of at least THREE major players: Ivanhoe Mines, obviously; Broken Hill Proprietary; and Teck Resources. Within Ivanhoe’s portfolio, the multi-metal Platreefs project springs to mind
CleanTeQ processing will not just be for water purification. CleanTeQ will have a primary extraction technique that is efficient and avoids many of the environmental problems associated with mining. While cleaning up the waste, CleanTeQ will be profitably extracting value from the solutions and slurries. They will be a reliable source of supply for a whole range of elements that no one else even targets as primary products. They are going to make so much money it is ridiculous.
POINT TWO, developing and expanding the market for scandium: it is closer than we think. There is interest and demand. There are prototype products. It is going to happen. But for God’s sake, scandium is just the beginning…a great beginning, for sure; but cobalt and a whole bunch of other elements is right behind, once Syerston is up and running.
POINT THREE. In my macro-outlook essays, I have said in these blogs that the Chinese are buying up whatever hard assets they can with their dollars we have sent them for the contents of Home Depot and Walmart.
I understand buying commodities and mines. Gold and real estate I understand. I even understand media and entertainment companies. But aluminum is not in short supply and there is no shortage of Chinese aluminum factories. So why are they
interested in an American aluminum company in Cleveland that is collaborating with Airbus, and why is the deal being held up in the U.S. Senate ?
I speculate that Aleris is not just any aluminum factory. My guess is that they are fairly far along in working with scandium-aluminum alloys and their applications in aerospace, aviation, and the military. I hope the deal is vetoed. We should just print the money from the Fed and buy out Aleris for ourselves and the strategic interests of the United States.
POINT FOUR. Remember the ad, “When EF Hutton talks, people listen” ?
Well, for me it is “When Robert Friedland talks, Hendrixnuzzles listens.”
Friedland is not a pump-and-dump artist. He doesn’t need a few dozen analysts and reporters hyping his stock. He could care less. So when he flat-out says, “Buy this stock, I’m giving you a tip”, I am selling whatever I need to to take a position at a reasonable price.
POINT FIVE. The potential of the innovation and intellectual property embodied in CleanTeQ has come to the notice of national authorities in Australia and they are funding research in CleanTeQ’s bailiwick, with CleanTeQ an active participant and beneficiary.
***
In passing, I note how thinly covered and how thinly traded the stock is. I have already remarked that the variety of disciplines tends to fragment analytical coverage of CleanTeQ. People do not understand the company and its potential, or they see just a piece of it at a time; and CleanTeQ does not blow its own horn very loudly. Friedland says [paraphrasing from an interview with Rick Rule]: , “We don’t care what people think. We just tend to our knitting and build value for our shareholders.” I am one of those shareholders.
To my way of thinking, we have a window of time where we are really ahead of the crowd. As I build a position, I will be ambivalent if the stock goes up, because I want to accumulate a big position in it and get the kind of returns we read about in teasers, on a great company that no one has ever heard of.
Long CleanTeQ
Hi Hendrix do you have a link to Friedland’s press conference in Africa on clean teq you could share? Thanks
*Btw I see HotCopper are talking about a US roadshow for CTEQF in March
Hi Johnnn…I looked for it quickly, it didn’t come up. But the graphics in the presentation were slides from the CleanTeQ investor presentations on the CleanTeQ website.
I’ll keep an eye out for the video of Friedlands presentation, which was at an African mining conference called INDABA, in South Africa. That presentation is referred to by several authors of mining industry publications.
If you are skeptical without hearing his “tip”, it is public record that Friedland put in $1.8 million recently and has about 20% of the company.
Yes I’m well aware of CLQ / CTEQF business and backers. Just as impressive is Australia’s largest super fund getting involved 🙂 the top 20 btw is littered with ‘big names’ in the Australian share scene.
A US road show in March…that would be great, if my position is big enough by then !
The presentation was only available for a few days through https://www.periscope.tv/ then it disappears which is usual.
Thanks for such an informative post as most of yours are. I have followed much of your advice and it has put a lot of green in my portfolio. Soon to be long in $CTEQF but minus one of my thumbs:) Up of course!
Excellent post hn of CleanTeQ and it’s many positives for dealing with the future, which they are addressing, more than very clever IMO.
So many bits of scattered news coming out. This stock is really exciting! Nothing more to add except to say very long ASX:CLQ
Attention Travis: When searching CleanTeQ on the web, my initial post of February 6 comes up. I would prefer that it only be available to your paid subscribers, if that is something you can control. Thanks, HN
$CLEANTEQ…some additional thoughts on the strategic integrity of the company…
Friedland amazes with his strategic vision. One aspect that I omitted was the relationship of CleanTeQ’s four pillars (cobalt, scandium/aluminum alloys, water purification, and efficient recovery of resources from mining) to world environmental and humanitarian goals that Friedland espouses.
Cobalt…battery power is clean power and a good supply of cobalt will further the process of electric power, especially in transportation.
Scandium/aluminum alloys…the lighter the vehicle, the greater the range and the less power is required to propel it. Scandium/aluminum alloys will improve the fuel-to-distance ratios of all types of transportation that employ them, because the vehicles will be lighter and stronger and use less fuel and less power.
Water purification..urban and industrial areas will benefit. World populations need more clean water.
Revolutionary mining extraction…this will wring out profit from ore that was previously uneconomic to mine, and it will recover great riches from sources that otherwise would not have been recovered. CleanTeQ will reduce mining and industrial waste, and hold a huge lead on any competitors, if not a de facto monopoly.
CleanTeQ and Ivanhoe mentioned. …
http://blogs.barrons.com/emergingmarketsdaily/2017/02/22/7-commodity-winners-in-electric-car-revolution/
Emerging Markets Daily
News, analysis and actionable ideas about emerging markets.
Search Emerging Markets Daily
February 22, 2017, 10:20 A.M. ET
7 Commodity Winners In Electric Car Revolution
By Dimitra DeFotis
As Tesla (TSLA) ramps up U.S, production of lithium batteries for electric cars and expands into emerging markets, the ridership revolution will have a profound impact on commodities.
An AB team of market experts headed by metals Analyst Paul Gait ranks the commodities that ought to benefit the most: 1. Copper, 2. Nickel, 3. Cobalt, 4. Graphite, and then behind: 5. Lithium, 6. Manganese, 7. Aluminium. But they add that current commodity prices don’t support the required demand for copper. They write:
” … innovation in batteries is enabling an electric revolution that has massive ramifications. … It took 120 years to build the modern copper industry. The electric vehicles revolution could require the supply base of copper to double again, but this time in only 20 years. This will be a prodigious feat and is simply unachievable at today’s commodity prices. … the total requirement is 35.8 million tonnes of copper equivalent production within the next twenty years…. the real issue is how the supply side moves to accommodate [demand] and what the price elasticity of supply is. Where commodities are economically scarce, any increase in demand growth beyond current levels will be very hard to meet.
Assuming that the transition to EVs [electric vehicles] does take place, the global mining industry will need a capital increase of between US$350 to US$750 billion. But … the capital increase is highly concentrated in … copper, nickel and cobalt. … Lithium is an abundant commodity where very little new capital is required to deliver all the supply that we will need to enable the EV transition.
Which equities could offer the appropriate exposure? Being long electric vehicles further down the value chain comes down, for investors, to answer the question as to which player will emerge as the winner in this revolution – the risk being to back the wrong horse. However, by gaining exposure through raw materials, one can eliminate that risk: all producers of the key commodities identified above should benefit through the appreciation of commodity prices.
Equities AB thinks will benefit include a mix of Canada, Australian and United Kingdom companies that trade over the counter in the United States: Ivanhoe Mines (IVPAF) (copper), which also trades in Canada and Germany; mining and commodity-trading play Glencore (GLNCY) (copper, cobalt & nickel); First Quantum Minerals (FQVLF) (copper, nickel); Clean TeQ Holdings (CTEQF) (non-covered, nickel & cobalt) and Syrah Resources (SYAAF) (non-covered, graphite).
Big day on the ASX for CLQ – CTEQF should follow suit. People waking up to Robert’s new 10 bagger.
$CTEQF…As of 10:20 a.m. eastern US time there is a 12% increase but volume on the USA OTC is very thin. Could you inform of the volume level on CLQ in Australia ? Is it a big volume day ?
hn,
If you mean yesterday’s it was 3.113M
Commodity demand forecasts…I do not know Paul Gait but he is singing the same tune as Robert Friedland. I feel well positioned with Ivanhoe for copper…and on cobalt, CleanTeQ fills the bill. Not sure how to get into nickel.
As far as graphite/graphene, I suspect the best approach is to find the manufacturers with strong applications, since graphene is a high tech manufactured material even though chemistry-wise it is just graphite. I do not see it as a commodity play. It is a manufacturing/tech play.
On lithium, I do have a small position in Galaxy but am wary of the sector on account of the high number of secondary and rather obscure companies involved. I think the lithium market will be treacherous and subject to wild promotion and investor speculative sentiment. Friedland is also very skeptical of lithium as a sector for investors to make money. I am OK missing out on a lithium boom if one arises.
For the fringe and rare metals, I am satisfied with CleanTeQ as my investment vehicle and will be putting maximum concentration into this company.
New to post, have been watching & profiting from HN & others. Consider $SJL, Saint Jean Carbon Inc, as a battery, technology manufacturer. Thanks to all the gummies, I hope to be more active.
Re-cycling lithium ion batteries interesting idea. This may not have any short term significance, but definitely worth watching. thanks for posting.
$CLQ (Australia) and CTEQF (USA OTC)…I checked the trading volume on the Australian exchange. CleanTeQ has an average volume of about a million shares a day. It has had surges to two or three million per day. The US OTC volume on CTEQF is a very small fraction of that.
This says to me that the company is really undiscovered by the US investment community.
Long CTEQF.
I want to get some soon, but waiting for $AUPH and $PLX to explode and then I will have some cash to invest. Unfortunately, it already started moving here the last couple of days.
Thanks for your work on this one Hendrix!
Hi Niiz. I was also waiting for some of my holdings to explode to get capital for CleanTeQ. But I concluded that CleanTeQ is likely to explode earlier than anything else I have seen.
$CLQ $CTEQF….alternate universe in Australia…I went over to the Hot Copper investment forum, it is an Australian discussion and information site.
As obscure as CleanTeQ may be in the USA, it is widely followed in Australia. One of the posts on CLQ on the Hot Copper website has over 21,000 views.
That post gives a reasoned price target for CLQ of $1.31 AUS within the year.
The estimate is based solely on cobalt and nickel sales…it discounts the water purification and scandium production valuation to ZERO.
The Australian dollar is about 75 cents USD so $1.31 gives a US target over 80 cents.
They are all excited about the US roadshow coming up.
Long CleanTeQ
Here is the direct link – https://hotcopper.com.au/asx/clq/
This one is definitely on the move.
Very good link with summary of Friedland’s bull market case for copper and other metals mentioned. Sums up the INDABA conference bullet points which closely follow the CleanTeQ corporate presentation on the website.
Any thoughts on Ivanhoe”s 10% loss this week?
1.31 x .75 = 0.98…..
Hedy: Having taken someone elses brokers advice, I say yippee. I sold and bought back for 10% saving 🙂
hedy, none of the fundementials have changed.
Now 12 drills in action, expect announcements coming soon.
Plenty to read on the matter here –
http://www.stockhouse.com/companies/bullboard/t.ivn/ivanhoe-mines-limited
Well done. Did you add shares or take profits?
Yes!!
Lots of different strategies can make money. If I try yours, I’ll sell out and the stock will go up instead of down.
Thats always the risk, but my experience (in both senses of the word) shows a better than 60/40 gain….this espec with bio where the odds of trial success is 1/10. Sometimes you get lucky by harvesting at the right time and narrowly avoid a price crash. As you say, ”Lots of different strategies can make money”. Each to their own. At least with this mining stuff I dont have to contend with all those 7 syllable words……I have a fair idea of what ‘drill’ means.
Nothing significant, just the normal ups and downs. The thing has gone from 36 cents to 3.80 in a few moths so we should expect some oscillation.
….A few moths!!!! LOL
Just checkin. Copper has backed off as well.
hedy…that’s without any valuation for scandium or the water business. I see blue skies ahead.
Can you simply stockpile the scandium you find?
I don’t see any reason why not. Mines stockpile ore all the time. No reason they can’t stockpile scandium production if they think it is beneficial to do so. Depends on cash needs and costs, no technical reason it can’t be done.
All: Ive only recently joined this/these threads (Derhh me!) I have to say they are great. They remind me of the bio threads of old days before they got too big to comfortably follow. I enjoy hanging out with friends as much and more than investing in ulcers.
Alan, I’m really glad you are following along. This is a pretty obscure corner of the site, but so far the contributors to it have been really great and constructive.
Let’s make some money !
CTEQF Co Chair Sam Riggall…Robert Friedland’s go to man and second in charge under Sam Walsh RIO and Andrew Mackenzie BHP.
http://www.theaustralian.com.au/business/companies/mining-man-sam-riggalls-lessons-from-the-dairy-farm/news-story/d35c7dff9d34fc9218c0f56f288d3b1a
Requires a subscription.
https://m.youtube.com/watch?v=lgoUwaNvEJ0
https://m.youtube.com/watch?v=oL3Cd01ho18
Thanks Johnnn. The interviews lay it out well. Note the Red Chip interview, as persuasive as it is, just looks at the scandium potential.
It ignores the cobalt and water purification segments.
At the time of the interview CleanTeQ was 14 cents.
CTEQF is undiscovered in the US. tick tick
Posted this in error on the Gold and hard asset thread.
PURELY SPECULATION…I have no evidence at all for this. It is purely a flight of imagination.
But it seems logical to me that shortly after the Syerston cobalt/nickel/scandium project is commissioned, it would make a lot of sense for CleanTeQ to implement a pilot extraction facility in a mine that has a rich multi-metallic deposit. Like maybe the Platreefs project in South Africa, which is the world’s largest six-metal PGM deposit outside of Norilsk in Russia. In one orebody, they’ve got platinum, palladium, rhodium, gold, and a bunch of other juicy stuff. .
Did I fail to mention… Ivanhoe Mines is the controlling owner of Platreefs ?
***
Another unsubstantiated speculation on the thinnest evidence. Would you be surprised to hear sometime in the near future that BHP or Rio Tinto announce a CleanTeQ processing facility to process tailings from an existing large mine to extract trace materials from it ?
***
I also posted on the other thread a possible explanation for the downplay in company presentations on scandium and water purification. It was a lengthy post, so I will not re-post here.
Electric carmakers on battery alert after funds stockpile cobalt Race to secure supplies of key material used in lithium-ion batteries
Suppliers to Tesla and other electric carmakers are scrambling to
secure shipments of the key battery material cobalt after a group of hedge funds amassed a large stockpile of the scarce metal
In a bold wager on higher prices, half a dozen funds, including Swiss-based Pala Investments and China’s Shanghai Chaos, have purchased and stored an estimated 6,000 tonnes of cobalt, worth as much as $280m, according to the investors, traders and analysts.
The stockpile is equivalent to 17 per cent of last year’s global production of the metal. Increasing use of batteries containing chemical forms of the metal by Chinese electric carmakers, alongside ambitious plans by the likes of Elon Musk’s Tesla, have created a fertile backdrop for speculators hoping to profit from swelling appetite for cobalt, which boosts the power of lithium-ion batteries.
They are betting that demand for electric vehicles will exceed market expectations and push the up the price of cobalt as battery makers such as Panasonic, which makes battery cells for Tesla, rush to lock-up supplies of the material.
Global demand is already expected to outstrip supply this year by 900 tonnes, according to commodity consultancy CRU. It estimates demand for cobalt will grow 20 per cent a year for the next five years, thanks to buying from the hybrid and electric car industry whose production grew by 41 per cent last year.
The price of cobalt, which is mined almost exclusively in the Democratic Republic of Congo, has jumped more than 50 per cent since November to $21 a pound and could rise further. Prices rose to peak at about $50 a pound in 2007, before dropping to a low of $10 in 2015.
There’s a complete vacuum out there (in terms of supply) Tony Southgate, Engelhart Commodities “There’s going to be bigger demand for cobalt,” Ivan Glasenberg, chief executive of Glencore, which controls almost a third of the cobalt market, said on Thursday. Each dollar rise in the price of cobalt generates about $55m in earnings for the company.
Tesla began production at its battery “gigafactory” in Nevada a month ago, sharpening its need for the metal, according to traders. Tesla did not respond to an email seeking comment. Pala Investments also declined to comment.
“End consumers worried about future price increases have been looking to fill their [stocks] and at the same time you’ve had some speculative buying from the hedge funds,” said Edward Spencer, an analyst at CRU.
With few pure cobalt companies listed outside China, hedge funds have been forced to buy physical metal to express their bullish view on the metal. Although the London Metal Exchange has a cobalt contract, it is not heavily traded.
“They quite rapidly decided that buying physical cobalt was the only way to get proper exposure to the cobalt price,” one trader said.
Still, traders warned the funds could have difficulties selling the metal for a profit, because the cobalt market is relatively small and release of new supply could quickly send prices lower.
About half of the annual consumption of cobalt comes from the electric vehicle industry. While carmakers have been trying to reduce the amount used, that has been difficult because of its ability to improve battery stability and capacity.
China is also helping to generate the bullish predictions for demand. While the country’s electric vehicle industry has in recent years relied on batteries without cobalt, carmakers have started to switch. Goldman Sachs analysts estimate China’s use of cobalt in electric batteries will almost double by 2025.
Cobalt’s price surge has led some battery makers to buy more cobalt in the spot market, further benefiting the funds that have stockpiled the metal. “There’s a complete vacuum out there” in terms of supply, said Tony Southgate, a cobalt trader at Engelhart Commodities in London.
https://www.ft.com/content/4f88cb60-f8f7-11e6-bd4e-68d53499ed71
http://www.cultofmac.com/125656/this-lsd-love-guru-turned-gold-mining-billionaire-gave-steve-jobs-his-reality-distortion-field/
1968, or whenever it was, was a long time ago. Robert seems to have matured quite a bit.
https://www.youtube.com/watch?v=owJFqPfQ9nA
LOL, lets hope these businesses are not a hallucination. The guy is quite a character.
If he is an hallucination, it’s a pretty good trip so far.
https://m.youtube.com/watch?v=3xW5M2s2Aag
Thanks Johnnn,
$CTEQF – Senior Executive Appointment – Syerston Project Director
Clean TeQ Holdings Limited (CLQ:ASX; CTEQF:OTCQX) (‘Clean TeQ’ or ‘Company’) has appointed Mr Scott Magee as Project Director for the Syerston Nickel/Cobalt/Scandium Project . Scott will lead the Syerston team through the completion of the Definitive Feasibility Study (‘DFS ’) and into project construction and operations .
This looks like a real plus to me “Scott is a people focused, innovative project management executive with 28 years’
experience in project development, project delivery and project governance. Prior to joining Clean TeQ
Scott worked for BHP Billiton as Vice President Projects where he was responsible for project governance and establishing best practice processes that improved predictability and capital effectiveness across the $15B annual capital projects portfolio. ” . I would think that Magee sees something in this company and has the experience to make it happen.
https://gallery.mailchimp.com/6b234a59bc4b0bc555986937a/files/e5d627fe-6a77-45b1-8d50-b9aa9d99c8c7/20170227_Scott_Appointment.01.pdf
$CTEQF long
Hope this opens as took forever trying to get copy link.
Release Date: 27/02/17 08:05
Summary: Clean TeQ Presentation – BMO Capital Markets Conference
https://drive.google.com/file/d/0ByAoKs9L_p0xck1wd0FMX2JJaGM/view?usp=drivesdk
Misunderstanding on time frame for Syerston…I was under the impression that the Syerston facility would produce cobalt and scandium this year, but the announcement of the project director seems to imply that construction will not begin before 4th quarter.
Will inquire of CleanTeQ as to the timetable
$CLQ (long)
CLQ SP at AUD 0.93 (up 10%) 3 hours into ASX 2/27 trading day.
Three consecutive days…up 12%, 7%, now this.
Helps some to offset 20% down on Ivanhoe over the same period.
Gold stocks and $Sand took a hit too. Funny with gold around $1250.
Bad day for me overall except for CleanTeQ.
$CLQ, CTEQF sm position – Appendix 3B
New issue announcement, application for quotation of additional securities and agreement
http://clients3.weblink.com.au/pdf/CLQ/01832811.pdf
from http://www.cleanteq.com/investors/asx-announcements/
$CLQ $CTEQF…Syerston mine time frame…A Definitive Feasibility Study is due this year. The mine construction timetable is three years.
http://www.theaustralian.com.au/business/opinion/barry-fitzgerald/friedland-clears-the-air-on-pollution-and-global-warming/news-story/8f6246a265f82f5b9e5aa736bdeecd91
Cannot read without subscription.
Pretty shocking stuff.
Friedland mentioned this previously.
Sooner CleanTeQ gets going the better…..
Four-year-olds mining cobalt for phones
http://www.skynews.com.au/news/world/africa/2017/02/28/four-year-olds-mining-cobalt-for-phones.html
Meet Dorsen, 8, who mines cobalt to make your smartphone work
http://news.sky.com/story/meet-dorsen-8-who-mines-cobalt-to-make-your-smartphone-work-10784344
Massive aftermarket ASX announcement out for CLQ / CLQTF!! Chinese are in!!
that should be CTEQF!!
Thanks,
Can you provide any links or who etc.
Friedland’s mines will be a source innocent of child and slave labor. He is also very concerned about uplifting the community around him. He is socially minded, but he a realist: He understands mines need to be profitable to afford to pay for the social benefits of the community around the mine.