In the FT article mentioned up thread, it once again pointed out that CBMM has plenty of supply in excess of demand for the growing niobium market, which is the second time I've read a similar comment this week.
On neither occasion did either article bother mentioning that CBMM had just completed a major upgrade of their processing capacity in the last couple of years lifting production capacity by 50% and costing something like $US1.3B (IIRC from something I read a few months ago). Prior to that expansion CBMM's capacity was around 100,000t/a.
It seems like a bit of coordinated effort to make the niobium industry look currently oversupplied, which means to me either/or 'they'# see us as a threat, or want to buy as cheaply as possible our company...
# 'They' being deliberately vague by me as it could be a myriad of competing interests from companies to 'funds to CBMM themselves IOW I have no idea exactly who...
I've backed some companies in the past that have had massive price gains and bagged well over 100 times (but I never caught all of the run), whether it's been lithium, copper, nickel or iron ore. Each and every one was in some special circumstances, like PLS that was less than 1c/sh in 2014, had a SPP at 1c in 2014, with many holders buying their $15k worth (1,500,000 shares). Sirius and Sandfire in copper and nickel also being still widely known..
However, despite all these prior huge gains, most of the stocks were in ordinary commodities, where there were lots of known deposits around the world, making none of them particularly unique during their huge SP booms. They just looked like really profitable deposits as they were discovered, had mets done, feasibility studies done etc.
With Niobium and all our possible by products, we are in rarefied territory, with one other example of our high grades in the world, in a mining friendly jurisdiction, in a commodity that is increasingly being needed or even 'critical' in the modern world.
It really is unlike any other commodity stock's outstanding performance we have seen in the past. The graphs shown by someone earlier today comparing the 2 years of growth of 'other' stocks made me think of this. We are not like any of them, we are truely unique.
What if the new uses for niobium are an outstanding success, in batteries with longevity and charging cycles. Battery manufacturers would be paying attention and quickly want deals with wherever they could source Niobium from. CBMM's current 'excess' capacity would disappear in the blink of an eye and Niobium prices would rise over the next few years.
By 2030 there is expected to be just under 7Twh of lithium battery production in 2030. If just 1Twh out of that total had just 50gm of Niobium per kwh, that would require an extra 50,000 Tonnes per annum of Niobium, more than taking all of CBMM's excess capacity. Imagine if all battery manufacturing went to adding Niobium, and possibly a lot more than 50ggms/kwh!!
We may not have scratched the surface of where we could go SP wise. I can remember when everyone in the lithium space was talking sales of $400-600/tonne of spodumene to be conservative in their calculations. The price went to nearly $6,000/tonne of spodumene during the shortage of 2021, then crashed 80% to around the current $1,100-1,200/t, making all the producers far more valuable than anyone expected in 2018-19.
If small amounts of Niobium are hugely beneficial to lithium batteries (and any other types that have anodes and cathodes), extending life and charge rate, the price of Niobium could be multiples of now in 4-5 years time.
Sorry for the long post, but I can't think of any other situation of a company, with a unique find of a commodity, that could be just at the beginning of the huge lift in it's use phase. If the VW EV bus that Toshiba are putting batteries doped with CBMM's Niobium into, works out brilliantly as expected by testing, then that alone could double our value on expected higher Niobium prices a couple of years into the future.
All IMHO of course, but sometimes it pays to think outside the square to look at what's possible.... We 'might' be cheap at $100 -$200/sh, if Niobium prices rise massively with the new uses..
WA1 Price at posting:
$22.64 Sentiment: Buy Disclosure: Held
(20min delay)