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Teal Valley T.TV


Primary Symbol: P.TEAL

Teal is a Canadian, pharmaceutical & NHP manufacturer selling to Canada’s national, chain drug stores, presently expanding its portfolio to include cannabinoid-based products utilizing proprietary formulations & extractions for both the global Rx & recreational markets.


P.TEAL - Post by User

Post by LuvtoInveston Mar 11, 2021 10:42am
155 Views
Post# 32772124

Spot TCs are irrelevant for TV to a great extent

Spot TCs are irrelevant for TV to a great extent
TV's partnership with Glencore cuts both ways: on one hand, it provides technical expertise and financial security to Trevali; on the other hand, Glencore’s life-of-mine concentrate offtake agreements with Trevali for 100% of the production are at International Benchmark (market price) terms (I am sure of this for Santander production. I am not aware of the details of offtake agreements for other mines, but I assume that they would also have the same terms).

Talking of International Benchmarks, these apply to both (1) Price of Zinc and (2) TCs.

Therefore, TV can not take advantage of spot TC charges. They have to pay the annual benchmark prices over which they have no control. Annual benchmark TCs are generally based on the agreement reached between Tech Resources & Korea Zinc. For 2021, it is estimated that the negotiations between Tech & Korea Zinc will end up at around $190-200, but you never know before the agreement is reached. So, the spot TCs are relevant for TV only to the extent that they influence the negotiations between Tech & Korea Zinc.

Zinc mining companies which have more control over their metal sales can take advantage of spot TCs. New Century of Australia is one such company which is already taking advantage of low spot TCs (because their entire production is not bound by offtake agreements at international benchmark).

I hope my understanding of the situation is correct. I welcome comments from knowledgeable people on the forum. Your comments will add to my understanding of the situation.

Thanks  
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