Noranda Income Fund Unit NNDIF

RE:RE:RE:Oh no, more smelter cuts possible! TC spot 200/ton !

[ljp0101]

Glencore will never pay fair value for NIF as there's no reason to. The SPA would need to be broken first somehow. Even a take under is kind of risky for them as I think they become on the hook for appraisal rights. If the continental European smelters get permanently closed then CEZ becomes more strategic but that's probably a next year decision for them after Russia energy fallout and the new European energy policy is clear.

CEZ is the one importing concentrate and the seaborne portion of it is highly variable as per NIF conference call comments. Probably Glencore placed some cargos that would have normally gone to Europe with us at <100/t TCRCs, bless them...

Next Glencore shoe to drop will be some usurous working capital facility as credit facility isn't big enough with the price and expansion volume increase at the inventory levels CEZ has been running.

I can't wait for this stuff to start unwinding in late 2Q and flowing into our economics in 3Q.