high cost producer leverage to rising price, page-19

Marcos

I refer to your statement "..compared to FML at around $900.."

This is about FMLs C1 cash cost
TRY C1 cash cost is about $550, although probably soon very much less half that (net Ag credits) before end year.

As for C2 cash costs, TRYs are almost certain to drop dramatically, whilst FMLs will probably rise, given the CRE acquisition.

If pog drops (It is possible and predicted by some, although I do not agree,) to 1300 then FML is marginal. Additionally TI is too far in the future to make a material difference and a very considerable capital expenditure will be required to bring it on line IF it is finally judged to be economic. Maybe another excuse for a cap raising if pog drops back. Time will tell. Less margin for error on FML than many imagine.

As for not getting it, well the market gets it, hence the huge underperformance of the FML sp compared to TRY and MML. Lets just hope that pog remains high as that is all that has allowed FML to survive. remember, despite the rise in pog the sp is still well under to recent cap raising price. Pathetic actually.