The kind of information I seekLet me give you an example of the kind of articles and information I seek and what they are currently telling me. This is the free part of these articles:
1. Concentrate prices starting to rise due to actions by the Chinese government to shut down plants, still we want stronger such signals weeks to come.
BEIJING Asian Metal 30 Sep 11 – SmEuGd concentrate inquires rise, and the offer is increasing to RMB1,200,000t USD187,500t at present, up by RMB100,000t USD15,625t compared with that seven days ago. A source from a separation plant in North China expressed that SmEuGd concentrate offers increase a bit, as terbium and dysprosium oxide offers go up. The plant holds RMB1,200,000...
BEIJING Asian Metal 30 Sep 11 – Ion rare earth concentrate demand has remained weak, attributed to the quiet market of rare earths. The price levels are RMB360,000-370,000t USD56,250-57,813t at present, as same as those last week. A source from a separation plant in South China claimed that ion rare earth concentrate prevailing price is about RMB360,000t USD56,250t now, with little change compared with that last week....
2. While demand and turnover is still weak, customers are clearly drawing down inventories and these articles speak about heavier buying returning within weeks, mid October, a bit delayed by inventories lasting longer due to worsening world economy. When you read the article below, note that Dacha valued its FeDy at 2450 usd at the last NAV which seems reasonably conservative.
BEIJING Asian Metal 29 Sep 11- The past several weeks have seen limited activity in European ferrodysprosium markets. According to local sources, European consumers, unhappy with ferrodysprosium’s current USD2,900-3,000kg price levels, will wait until stock levels are depleted before making purchases. In addition, the source added that a weakening global economy and the consequent scaled back production output for downstream products suggest that current stockpiles are likely to last longer than orig...
End comment to anyone new here is to rapidly pick up knowledge that most of the REE sector counted it tons or kg is bulk commodities Cerium and Lanthanum. They have a really bad outlook due to overcapacity in China and lots of new supply from Lynas and Molycorp destroying these markets the very day these two companies come online.
Terbium and Dysprosium are about 0.2% and 1% of the REE tonnage, key heavy REE´s and they are a completely different story since Molycorp has none of it and Lynas very little at the same time as it is this production in southern China that is actually being closed down now due to environmental reasons.
So you do not want Molycorp and Lynas because they are mainly Cerium and Lanthanum producers and you do not want the juniors like HRE, Avalon etc because they will come online say 2014 - 2016 when Toyota and others will have re-designed the new models to use less REE. Great Western and Lynas is slightly better than the rest but Dacha is the only vehicle that actually provides us with the right metals during these two coming years when you want them.
At the moment everyone is calling for Dacha to sell the metals and buy back more shares, maybe do a dividend but while that in my view also is a very correct thing to do in these dangerous times, one should also remember that the fundamentals for the metals after this correction is great.
So I would support conservatively selling say the FeDy, keeping the rest and buying back all the shares allowed to make the rest of us getting a higher NAV all things else equal.
Dacha is a great opportunity and it seems to me we are mostly being kept down by one energetic seller, nr 1. People are allowed to sell, it creates opportunities new shareholders and creates the possibility for the company to increase NAV by buying cheaper shares.