As the old saying goes.....
"The proof of the pudding is in the eating"
For LMG
"The proof of magnesium is in its production."
Until the demonstration plant is producing magnesium and the real life numbers on costs, efficiency, emissions, etc are released, the stock remains speculative.
The transition period between demonstration and the commercial plant will see a rapid rise in sp imo.
An analogy could be:
1. Exploring tenements = Lead up to demonstration plant
2. Assays = Demonstration plant running
3. Assay results = Metrics and processes proven
4. JORK/Reserves = Results from demonstration and process capability
5. Mining = Commercial Plant
6. Offtakes/sales = Offtakes/sales
The offtakes are the last cab off the rank. Offtakes are very important to have but they are not the steps to get there. Offtakes are the goal but prove nothing until the production stages are set in place.
When I read the last announcement, it meant very little to me. The offtake agreement was first announced as a MOU in 2016 (nearly 7 years ago).
The offtake agreement with MEC has been in every significance announcemnt since. I fould it in 2017,18,19, 20, 21, 22 and now.
Compare the 2017 announcement to 2023 and you will see that in practical terrms there is no difference.
31 May 2017
"Latrobe Magnesium Limited (ASX:LMG) signed an exclusive distribution agreement to sell its magnesium into North, Central and South America and the Caribbean markets. The deal will deliver excellent prices to LMG due to a US anti-dumping duty payable on magnesium imports from China."
16 January 2023
" Latrobe Magnesium Limited (ASX:LMG) has signed an upgraded exclusive distribution agreement with Metal Exchange Corporation (MEC) to sell the majority of its magnesium into North, Central and South America and the Caribbean markets. The contract will deliver excellent prices to LMG due to a US anti-dumping duty payable on magnesium imports from China."
2017 says "to sell its magnesium"
2023 says "to sell the majority of its magnesium"
I'm not splitting hairs. The announcement whilst good, is still only a regurgitation imo.
Bigger fish to fry in the near future.
All the best to holders, much bigger news around the corner.
