Who's Mr Regal? Words on a screen. Since JL posted a tweet that appears to be an image of regal's post. It's only fitting there is a right of response. JL has shown his true colour to the industry in which he is a professional of. His actions have drawn the attention to himself and those associated with him. Its up to the judgment of the industry and those related to it. He attacked a post containing a symbol that is held high in the chinese culture and history. Nothing else need to be said. Moving on.
By my calculations MtC will add $72m net margin to its financial year on a worst case and $80 -86m based on current economics. The final is in between, based on the company's projections.
Here are the calculations.
The numbers for 2018 was constant for three quarters. The last qrt skewed the results. This was due to permit issues and the installation of the YOP, there was down time.
Cost for the 1st three quarters were $360/dmt. With the YOP this will fall further. The average achieved price was $927, up 18% from 2017.
Worse case
If we use 760/dmt ( a fall of 18%, 2017 price)- 360 cash cost= $400/dmt. × 180kt= $72m . At 400× 200kt= $80m.
Lets use current contract price at around 9% fall. If we use 830/dmt- 360= $470/dmt.
470 ×180= $86m. At 200kt×470= $94m.
360 cash cost is used withou the YOP and a lower mine grade. With the YOP and higher mine grade, the result would be higher. However Q1 has skewed the numbers. The calculations have been based on 1 shipment and cost during commissioning. The analysts are basing numbers by qrts and not yearly.
Basic calculations.
Tesla is measured by analysts based on qrts. Yoy the production increase 100% and out selling competitiors. Who are the fools?
If we take the Pilbara miners and apply 9% fall on $740/dmt 2018 contract price as announced. Cash cost currently plus interest leave a margin less than 350/dmt. At 18% fall in contract price leave less than 300 margin.
Who is the marginal producer?
Gxy has achieved a run rate of 15kt every three weeks. 260kt per annum. Our customers have taken this. We will be sending 180-200kt. Less than the converter capacity. Where is the bottleneck or oversupply? In addition, our customers have increased their capacity.
Only the converters that have contracted more than they can process are having stockpiles.
Adding the total mine supply and dividiing by the number of comverters are flawed analysis. Each manufacturer contract different volumes and only to their own specifications. Converters produce different specs and sell at different prices.
If analysts were good at what they do, they wouldn't be analysts.
Use your own research.
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