Many thanks to @mayo1975 for the FNArena broker information and...

Many thanks to @mayo1975 for the FNArena broker information and articles posted. I always appreciate seeing them.

I bought a few more today @ $2.93. My average price is now $3.50 with a 6.5% weight in my portfolio.

I also read the article posted by Mayo above (background with white text on L.ivewi.re. URL will be censored if posted here). It's my thoughts exactly.
It's weird how the price rose after the announcement then finished down so much by close of play yesterday. I guess broker ratings changed (which takes a few hours to be published) and that prompted some investors to sell.

In regard to the low content / low quality posters who come out of the woodwork after a major announcement or downgrade (Domino's, CSL, EVN, etc. in recent times come to mind) they are a complete waste of everyone's time, including their own. The give away is: a dozen posts a day, all on different stocks, disclosure "not held", it's their first time posting on your stock's forum, and the stock released a price sensitive announcement that day. I press 'ignore' pretty quickly. The one word, "ouch" comment really triggers me when it appears before the 20 minute period where the announcement is even visible on Hot Copper. Total bottom feeders.

I share the 12% IRR concern although presumably folks at S32 know more than a simple retail investor with a poor knowledge of finance. They are committing to spend US$2b, so I'm reluctant to pretend I know something they don't. I also am concerned about our nickel operation, although I suspect (somethig Rick Rule has mentioned) that a) the Russians are dumping everything they can sell to fund the war, especially platinum, palladium and nickel, with no sustaining capex. This can't continue indefinitely. And b) the Indonesian operations are an environmental nightmare and devastation of huge proportions, which the locals will protest/rebel against before long.

What needs to be remembered when saying "they've already spent $2b on Hermosa. Now they're spending another two billion" is "Hermosa" is the entire site. The Taylor mine is going ahead for zinc + silver and lead. If the Clarke manganese project gets the go-ahead (which we all assume it will) that's $1b per mine for the purchase. Mention was made in the materials yesterday of a potential US government grant for Clarke -- something Ash has spoken of here. Meaning we could potentially go ahead with the manganese mine with a significant contribution from Joe or Donald, with the roads and power already in place.



I wrote here before Christmas, pondering the possibility of economies of scale from various projects within the Hermosa precinct. Sure enough, numerous mentions appeared yesterday of de-watering, roads, power assets, and infrastructure which, once built, could be used for future sites.

And of all the Hermosa material released to date, this is the strongest I've seen S32 talking up Peake and Flux as very long term copper pipeline projects. In previous presentations Peake and Flux were not much more than footnotes. My point is that $2.2b to build "Hermosa" sounds like a lot for a zinc mine (and it is). However if GK and team are anticipating that Clarke is almost a certainty, and then Peake and/or Flux will all piggy back of infrastructure already in place, suddenly the cost to acquire each mine in the precinct (the original purchase price from Arizona Mining, divided by 2 or 3 or 4 mines, rather than just 1) drops dramatically. As does subsequent capex. I'm just speculating and offering a theory. I am not an expert.

Hermosa feels like massive, Chalice Mining / Gonneville-type area with multiple viable mining options which could be beast of an operation in the next 7-10 years. And it's happening. It's game on; rather than more studies, more talk, more waiting.

I liked how costs were kept under control during the half. The buyback plan was nice, but I understand how it wasn't appropriate at the moment. Low dividend -- good. I like RedDirtDan's description of S32 as a growth stock! Production numbers were strong. The coal production decrease was expected, and a type of investment in future production. Not perfect, but enough to keep me happy. Taylor is being funded from free cash flow and will be a significant contributor to our EBITDA in three years. Commodity prices are low and we benefit from future price rises as an existing producer.

The cure for low prices really is low prices. It's a capital intensive, cyclical industry where sustaining capital is needed to replace depleted resources and bring them online. Highs and lows are not a fault of the system but a key feature of it. There is no incentive to bring new product online today, but we are still as a society using various commodities and reserves are depleting. As higher cost producers close, eventually prices must rise. I suspect that demand will be higher when this occurs too When commodity prices rise, South32 will no doubt benefit.

The thing I struggle with is that the stock markets are at record highs on the back of a soft landing, economic growth, no recession and a cut in interest rates. Yet commodity prices are low because of demand concerns.