Q4 Earning Discussion Area, page-43

So our next discussion point is about prices. Here are some of the items to think about.

• Spot price and realized price are not the same. Every quarter so far the spot price has been much higher than our realized price. For instance last quarter our "Realized Price" was A$999 which is around US$650. Spot prices were averaging in the $930 to $980 range most of that quarter so we are far from getting paid what you see in the spot price.
• Spot prices rose by around 200/t from last quarter to this quarter.
• Shipping costs are much much higher when you are shipping near Chinese near year (or any Chinese holiday)
• In Q3 the PLL contract only paid us US$799/t, we believe this should have been $810/t and we can explain the discrepancy since spot market prices never dipped below $900/t
• first school of thought was to take what we had in Q3 and bump it by 200 since spot price went up 200 this would put our JV sales price at $850/t
• 2nd school of thought was that spot prices climbed about 14.5% since last quarter and that we should apply 14.5% to the realized price from Q3 which would place us at $761.
• The rest of our adjustments to price related to shipping and gut feel, our low guess was US $761/t (A$1144) and our high mark was US$850 (A$1230)

Please feel free to comment and express your views. The reason I am posting this data is to stir some conversation that will be helpful to all.