Why are Shorts so high and increasing, page-44

The valuations imo are very very tricky at the moment, because of the rapidly changing product pricing. We have seen huge margins all but disappear lately and in the context of what is in store moving forward, it all comes back to pricing assumptions. That is of course linked to supply/demand dynamics. It’s all very tricky to be confident about future pricing, however, I look at the unfolding demand story (with the various forecasts and limited info there is available to us) and see huge growth on the way.
I just can’t see the supply catching up when the momentum really starts to build around EVs, and I think that basic economics will drive prices higher simply to enable uneconomical producers to become part of the supply, economically - I see current suppliers getting their order books filled and the demand seeking further supply. This will come from less economical suppliers and therefor prices will simply have to rise. Spod miners can’t flood the market for long at current prices, simply because they will soon go out of business as they aren’t making any money. Similarly, a whole bunch of new mines can’t open and sell at a loss or at tiny margins... they won’t get built based on that.

I think there is a big wave of demand building that will surprise most of us.
Forecasts of +2Mtpa LCE by 2030 aren’t crazy imo.

Anyway, I see prices reaching new highs as this dynamic plays out and therefore Mt Cattlin shifting back to significant margins. Imo $100m pa earnings is on the cards. That’s “only” $500/t margin, requiring prices to move up to around $1000/t.
Not crazy imo when we look at where global supply is currently on the forecasts curves.
Yes the LOM is limited but we do have expansion potential beyond our current reserves so that assumption needs to be factored in also.

Plenty of risk and uncertainty!

It’s all about pricing assumptions!

Only time will tell who is “right” on these assumptions. It’s also funny how some base the future (10y+) on the specific price today, considering how rapidly that pricing has changed and the forces that are unfolding that will drive that pricing!

So, hard to say. Not impossible for Mt Cat to make $1b over its future, if a few assumptions play out (and imo not even ridiculous assumptions).
What does that make it worth? $500m...?

The best we can do is try to form our own assumptions for the future based on as many credible sources as possible, and do our own research to assemble the puzzle as best we can. There is no right answer, just “reasonable” assumptions!
I like it when people discuss the various scenarios ahead, the associated assumptions and the basis of those assumptions... that’s when we learn stuff and strengthen our own views...
that’s been missing here lately, for the most part!