Adanac Molybdenum Corporation AUAYF

Uh Oh

[advice4U2]

From Cannacord ----------- While natural gas and oil inventory numbers are huge and seemingly getting bigger everyday, copper looks like its inventory is starting to head up as well, which sooner or later, is going to affect copper prices. This is all basic Economics 101—as supply goes up, sooner or later, price goes down. Also molybdenum prices have dropped significantly in the last few weeks as Phelps Dodge increases production. But one commodity, zinc—just seems to see inventory dropping significantly every day and today, we see another 3675 tonnes yanked out of inventory. Also today, Barclay’s considers zinc its favorite commodity in the metals sector. Zinc - used as protective coating on steel and used to make brass, is also used in chemical compounds in rubber, paints and also used as sheet zinc for galvanizing iron—is one of those commodities that has seen big demand as many other commodities from the Far East. The argument is still there that to bring extra production on stream would take a lot of time and expense. Many potential new supplies come from Canada (emphasis Northern Canada) and hence names like Canadian Zinc, Yukon Zinc and Wolfden are attracting some interest, but we note all of these are in the extreme north of Canada and costs would be big. In the search for another Breakwater (which we consider profit challenged and with a lot of stock out) but sure created some joy for us as we featured it at $0.39 and sold at over $1.00. Maybe we finally found another cheap way to play zinc….