Largo Inc T.LGO

Iron-ore price down

[Clipper2]

$172

https://markets.businessinsider.com/commodities/iron-ore-price

[Clipper2]

https://www.reuters.com/business/energy/china-goes-driver-brake-crude-oil-iron-ore-copper-russell-2021-08-09/ Among metals, iron ore imports fell for a fourth consecutive month, with 88.51 million tonnes of the steel raw material arriving in July, down from 89.42 million in June and some 21% below the record of 122.65 million from July last year.   Imports for the first seven months

[kha341]

Thank you Clipper. Let’s see, Chinese import of iron ore = 89.42 million tonnes in June. Given that China buys about 70% of global seaborne volumes, we can assume that the global trade of iron ore = ~128 million tonnes just for the month of June 2021. And our iron ore stockpile only = ~2 million tonnes? How difficult is that for us to sell, let’s say, 50,000 tonnes per month? In recent weeks

[Clipper2]

kha I totally agree with you. They could offer decent a discount price for the iron-ore. $100 would be a good number as you suggested. A firesale would probably attract quite a few enquires.

[kha341]

If we decided to give our iron ore away at the dirt cheap price of US$50 per tonnes, then 1) Our 2,000,000 tonnes stockpile would still be worth US$100M,  2) Our annual production of 500,000 tonnes would still = US$25M / year, and 3) A monthly sale of, let’s say, 50,000 tonnes would = US$2.5M / month Mr Volant, wake up!

[kha341]

Almost all of those amounts could go straight to the bottom line of our books due to the fact that the Net Profit Margin would be huge, possibly at 90 - 95%.