Just to get you and me onteh same page here. THe comment of not being demand restricted is in reference to 11kt and then by inference 22kt.
What he is saying or if you like what was meant if I could be casual about it is that the first 11kt is a no brainer, its to customer orders, ie not "producing and they will come".
He means we ARE demand restricted on the second 11kt. In other words, 22kt when demand comes out but first 11kt no demand restriction.
This has been a point I've locked horns with people about. To me demand has never concerned me. In so far as, fatalistically speaking, the solvency of Lynas was concerned.
I really mean it when I say I dont care if I hear from Lynas once per year once I know we are at nameplate. To me nameplate is everything. Sustainable nameplate.
Eric said today there will be no (significant) issues ramping to 22kt when the demand is there.
By implication that answers the questions of "do we hav ethe same pipe issues with phase two".
Phase 1 across multiple facets has been the baptism by fire.
One thing I am pissed about (it's a bee in my bonnett) but there was jsut no proper way to frame it today because NC would have shut it down as not relevent to proceedings....
What I wanted to convey was what I have been talking about here. Lynas should know more than any other company, that perception is everything. Chris Terry's coverage to date(the analyst from Deutsche) is very damning, very pessimistic and in not so many words he has basically said to Lynas he does not believe their estimates and what little guidance they have provided. Now if I was teh management team, talking about ramp up to 11kt by end December, now that implies, if nothing else, annual production for FY13-14 of at least 5.5kt. Why not reiterate that? Why allow an analyst to publish an estimate of 4200t without at least having a discussion.
I'm keen to see Deutsche's update. I'd hope for a correction of sorts, but its possible they will wait again for "proof of life" so to speak.
LYC Price at posting:
30.5¢ Sentiment: None Disclosure: Held
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