Daily price prediction thread, page-5095

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dbd25

6,756 Posts.

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12/10/21

11:26

Post #: 56733528
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Originally posted by carnabombers: ↑

So interesting re tweet from y Kim on a * report on silica sand. They broke diwn each of the major companies in Oz and the para I thought hat was most pertinent was on Australia silica
"However, it blamed unusually high international bulk freight rates associated with the COVID-19 pandemic for hampering efforts to market the product to the Asian glass market".
So for all the FOB posters that said freight costs were irrelevant because the customer pays, this extract will tell you that whilst the customer pays fob, the selling price to ensure fob is too high because of our freight costs.
I wonder if this is the main reason why we do not have offtake agreements yet. DUNNO PURELY A GUESS. Be nice if we were told something about the high freight costs. Hopefully it's purely a covid related issue and by the time we get to market (2023) freight costs will be more normalised. If this is the case then we may not get any offtake agreements signed for some time. I hope I am wrong.

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The bulk freight costs have been increasing steadily throughout 2021, and right now they are higher than ever. So you may be correct in suggesting there will be no offtake agreements in the short term. The Baltic dry index is currently at ~5500
https://tradingeconomics.com/commodity/baltic
Interestingly, it was not elevated at the end of last year (1000-1500) when Bruce was saying the offtakes were about to be signed. It only started increasing after Feb 2021. So the initial delay in the offtakes must have been another issue.

All IMHO, DYOR

VRX Price at posting: 20.8¢ Sentiment: None Disclosure: Held
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