biggest risk

ok. sat down and thought about this pretty hard. think i know why the market doesn't like cci.

used to think chrome ore price was the biggest risk. but this can't be it since even if the price falls 50% it would underpin a share price multiples of what it is at currently.

now though, i think it has more to do with the small size of the market for the non metallurgical products. which is the market CCI is targeting.

something like, what 10% of total chromite ore production is directed to foundry chemical refractory. and that's global production. so how much demand is there for these applications in south africa alone? very very little one would think.

then you have limitless economic reserves of chromite ore sitting in the bushveld area of south africa.

im gonna go out on a limb and say it's possible, maybe even probable, that by the time cci is ready to mine, xstrata/kermas etc has already added the extra capacity to accomodate for the users of non metallurgical chrome ore in sth africa.

given the very small size of the market they could probably do it with the push of a button.

so, i think cci might be left with no market for its chrome ore in south africa by the time they start mining. since all users already have offtake contracts with the big boys.

other option is to send ore to china but then one would think they aren't very competitive with kazakh/indian/phillipino ore given the geographical differences.

noticed too that in agm presentation last year they said they were "finalising" off take agreements. no updates since then on sales contracts.

what does everyone else think, am i totally off target (probably the case)? is this a valid concern or am i being paranoid?