Good afternoon
the gold market continues to be in disarray…futures are having a much larger premium, as tehy should…traders fear, that their buyers will ask for physical delivery. You start to ask the question, wheather the gold is really there!!
In any case, inflow into ETF´s continues, as is physical buying - but we are down a few $ in the moment, following a very strong close last night, at 1647 US$/oz.
The A$ is having a very strong day…nearly 62ct in the moment…Australia has been doing well in the crisis - reacting fast politicially as well as on the fiscal side…The ASX has lived a life on it´s own for a while now, and has performed well of late ( my fund is up by about
Amidst tentative signs around the world, that the virus-situation is improving - especially in Europe - equity markets are very strong, again…and metals as well - up between 1% for nickel and 4% for copper. As Bloomberg said : Dr.Copper indicated the weakness coming - is it now indicating the strength coming?
Anyway - the search for yield is continuing - but there are some question marks about regulators continuing to clamp down on dividends…my fund is up by about 36% since 23rd of March - after fallen by half earlier! A good deal of the fall as well as the rise is due to a very volatile currency - but I think we have some more room in the currency against Euro, and much more so in the underlying equitiy holdings!
BMW sold 20% fewer cars in the 1st Quarter - but surprisingly, they increased sales of EV´s by 13% in the Quarter. That´s certainly a promising development!
Must Americans get used to have not enough meat on the table? Big meat producers like Tysons are having substantial trouble with the virus, and have to close some facilities. There is nothing better than a old fashioned farm with a few hundred and maybe one thousand pigs ….than these massive meat-fabrics!
Chalice - announced some more gold-sniffs from their drilling on the gold prosepct Karri in Victoria - nothing to do with the recent multi-metal find in Western Australia. The target area of CHN at Karri is very large, and at this stage, I would regard the occurence of any unusual gold grades a success and as progress along the search for the real ore body! But gold in Virtoria might be nice, but nickel/copper/palladium/platium in WA is really what made them move like a rocket. Drilling there will start again imminently - and could weaken them in the case of non-success, or drive them through the roof, if they can repeat those kind of recently announced numbers. I am hoping for the latter!
Oklo - have completed the first metallurgial test of their ore from Seko - very succesfully, with 94% recovery for oxide, and 85-88% for transitional and fresh ore. The hardness of the ore is pretty moderate and comparable to other projects around. This is good news, even though not unexpected! It would not have been the first project to get killed by unfortunate, metallurgical issues! More drilling results should be in the pipeline - but they might wait for the Quarterly sometime late this month for publishing, unless they are very material. The question is always: Is more of the same material or not? I guess it will be, if they continue with the recent rate of success, as it will bring them ever closer to having a mineable deposit in Mali. Let´s hope, that they will be able to continue drilling! They have more money than they need…
Metro Mining - have started mining again a few days ago. A day shift has started and did exceed budgeted rates of 4 millt equivalent. Port capacity has been increased , and everything is working well. The ore is still a bit wet - but that´s not really unexpected, sinnce the company is always suspending operations until the end of March. There is still a little bit of rain up there - but with 33 degrees every day, this should not be problem going forward. The Alumina price is down, impacting some of the prices received - but the A$ is down as well, as are freight rates! All should be good here, especially, as freight rates ( and they are a huge part of costs ) are still only just above multi-year lows! Non-site costs ( and nearly all of that will be transport to China ) have been 20,68 A$/t last year….they should be 4-5 $ down this year , of which about 2$ might be lost to the weak A$ ( freight costs are in US$ ).
Have a nice evening!
WS