NORTHERN SUN MINING CORP LBEFF

RE: RE: RE: Nickel prices

[JohnEStromJr]

Tight supplies of nickel because of the strike have boostedby25 percent the premium paid for the metal in the U.S.Midwest, MaartjeCollignon, an analyst at research group CRU inLondon, said in an e-mailtoday. The fee is added to the spotprice of London Metal Exchangetraded nickel for immediatedelivery and reached 36.2 cents a pound in November, accordingto the CRU.


Tight supply of nickel? I just don't see that. If 10% of the world's supply of nickel was withheld from the market and yet, in spite of that, the LME stocks continued to rise to record levels something is amiss. That was just Vale, too. There are dozens of companies around the world that have slowed production or ceased altogether. The world is awash in nickel because the building boom in Dubai has collapsed and little other building [with the exception of China] is going on right now. Most stainless will use nickel and new construction accounts for an appreciable amount of stainless use. So do new restaurants and I don't see many new restaurants being built these days. The last major nickel [stainless steel] user is hospitals and clinics but, again, I'm sure not seeing much new construction. With almost 143,000 metric tonnes of nickel just at the LME we aren't going to see a substantial improvement in the price of nickel until we see those numbers dropping. I hope we do but again, there is a LOT of nickel producing capacity sitting on the sidelines because, at those prices, few can make a profit.

How does that impact Liberty Mines - they HAVE to produce and sell nickel concentrate as that clock is ticking toward the July payoff of the $5 Million loan and we need to see substantial paydowns in the other loan and the interest on those convertible preferred shares. We are not in the best of positions as we probably do not have the luxury of waiting for the nickel price to improve - we have a drop dead timeline. Jilin Jien is in a win-win position. We are NOT Jilin Jien and could lose if those loans are not satisfied within the time frame agreed to.