Zinc & Lead Prices Zinc & Lead prices are nearing 10 year highs with inventories on both the London Metal Exchange and Shanghai Futures Exchange declining to price critical levels effecting the flow of the available metal stocks worldwide.
The zinc price continues its upward price trend now approaching the critical $3000 per tonne mark on its way to the $4000 per/tonne mark.
Charts here: https://www.kitcometals.com/charts/zinc_historical.html
This continued inventory decline will not reverse itself for several years, and with what new production is coming on-line will not be sufficient to cover what world demand will be going forward.
During an interview with Glencore's chief executive Ivan Glasenberg he stated “People talk about new production coming [into market] but it’s really not that much,” he observed. “What’s really coming on? Gamsberg [a mine in South Africa] which is about 250,000 tonnes but then you have Skorpion [Namibia] which is leaving the market and was producing around 180,000 tonnes. Dugald River [Australia] is coming on stream in the second quarter of 2018… and not that much else. And if you look at the tonnes that have been taken out. Century [Australia] took out 500,000 tonnes and Lisheen [300,000 tonnes],” he said.
Mr Glasenberg also added that: “With demand growth of 2.5 per cent the world is going need an extra 390,000 tonnes per year.
Full article here: https://www.ft.com/content/fc061e57-d137-3eb2-bcf2-1d7fd75c8282
Quality projects/operations run by proven management teams in this sector is imo a prescription for reward, and I cannot find a more undervalued play than that of "Pine Point Mining".
If one can buy shares in a company that has a discount of 40-50% to its post-tax NPV, then I feel that's a pretty good investment. Based on Pine Point Mining's current 80% share discount (@ $1.10 zinc) to post-tax NPV, the upside makes this play imo, as with some other very successful investors, a very good investment where patience will be rewarded. GLTA