Dear all, I’m a German VR8 holder. I have been following the...

Dear all, I’m a German VR8 holder. I have been following the discussions here for quite some time, but never posted. I thought this would be a good moment to share some of my thoughts. Feel free to ignore them.

I see investment in VR8 as a twofold bet. First, I believe that Vanadium prices will go up significantly in the next years. Like many people in Germany and Europe, I believe that VRFBs are the next thing. A few VRFB grids in China won’t create significant demand. It has to become a big and global thing. And this will take a few years. In Germany, the government already invests in VRFB technological innovation, but large-scale production has yet to commence. Moreover, European investors think only about battery production, not yet about mining. This is about to change. Securing Vanadium resources is already part of strategic planning on national and European level. A free-trade agreement between Europe and Australia is being negotiated at the moment and will be signed soon, possibly already 2023, but certainly before VR8 goes into production. Besides other critical metals and rare earths, Vanadium is explicitly mentioned in the preparatory documents. Australian miners will profit from the agreement, no matter where their resources are located – as long as production is ESG compatible.

Until VRFBs are a big thing, Vanadium prices will be driven by the demands of traditional markets, especially the steel industry. In China, this industry is only slowly recovering from Covid. In Germany and other European countires, many steel producers have recently stopped or significantly lowered production, due to extremely high energy and gas prices caused by the war. The energy crisis made anybody in Germany and Europe aware of our strong dependence on Russian resources. The shock also caused a massive debate about our even bigger dependence on China. As a result, the free-trade agreement with Australia is now higher on the agenda.

The second part of the bet is VR8 more specifically. When I decided to put my money into Vanadium, I did a lot of research. Don't want to go into details, but no other company convinced me more than VR8 (TMT coming in second). I think that VR8 will go into production just in the right moment. Therefore, investment makes only sense with a 3-5 year timeframe. In fact, all supportive factors – recovery of the steel industry, growth and globalization of VRFB production, new trade agreements/geopolitical considerations – may all reach a climax at the moment when VR8 goes into production. For all these reasons, I think that we Vanadium investors in 2022 are like Lithium investors in 2019. We need farsightedness, a little bit of faith, and a lot of patience. However, at any moment between now and 2025/26, a major off-take might change the situation for VR8 from one day to the other – especially now, with a DFS in hand, a very convincing one IMO. That’s why I won’t sell, no matter where the share price goes, because I don’t want to miss the moment.

Sorry for the long post. Good luck to all.