Iofina Share Discussion Threads

[superg1] 26/6/2015 08:40

1MM if you read the last post they can't sustain it for long.

It's been bugging me for a while but I had no time to try and work out what was going on.

More ammo now and I will be letting certain SQM interested folk know.

Contesse lied about 2014 v 2013 production in the last conference call, now it seems they are best misleading investors with their last news.

They claimed expansion but dropped caliche mining by 17%.

[superg1] 26/6/2015 08:37

I've just checked the SQM closed Pampa Blanca mine. It closed in March 2010.

In 2009 it was at full tilt.

In 2010 they mined just 10% of the caliche they did in 2010.

The iodine production dropped from 1200mt to 800mt.

That means they got 680mt from the existing previously established heaps and 120mt from the mined caliche that year.

Using that as a guide they had a backlog of around 66% of the iodine at any one time piled up ready to be leached from caliche.

Jump forward to their next example at Maria Elena which is more current as it closed in Nov 2013.

The mined Caliche dropped to 86% of 2012 which is about right. Iodine produced dropped to 88% of 2012.

With no Caliche being mined in 2014 they produced about 380 mt or just 25% of what they did in the previous year.

That suggests they had a backlog of 25% worth of iodine in heaps to leach.

As they have publicly stated their cost cutting and staff lay offs, I think it's fair to assume the Neuve Victoria mine has about 25% of a heap back log. Not forgetting the 2011/2012 chaos where SQM sold all they could while the prices were high, so thy would have exploited heaps.

A 25% back log for SQM at the location is 1500mt. Judging by their own news they have taken 1000mt of that.

In other words at some point soon they are going to have to mine extra caliche to build up the heap leach inventory to where it was.

So it seems they have been sneaky to represent lower costs where the actual cost is higher. Another load of SQM BS identified.

[1madmarky] 26/6/2015 08:23

That makes sense, it's a desperate short term move and will lead to a "surprise " shortage in the future ( whenever SQM want the price to go up). with the inherent lag between mining and actually having something to sell.it should give a good period of higher prices.

[superg1] 26/6/2015 07:51

I'm testing the water here re a theory to see what folks think.

SQM

In their 2014 report they show they mined 17% less caliche then they did in previous years.

As some know I've been trying to work out how that could happen

In iodine terms it should have been 1000mt less from the usual 6000mt, but the production didn't drop.

The Caliche heaps they had at Maria Elena were leached out in early 2014 even though mining stopped in late 2013, hence they show just under 400mt of iodine mined at Maria Elena.

So here is my theory re how they mined 17% less caliche but produced the same amount of iodine.

At the NV mine they will have a number of heaps ready to leach. It's my theory that they increased the rate of heap leaching for heaps already established.

Thus the mined caliche figure drops but the iodine production remained the same.

At the same time they talked of production expansion at the location which didn't make sense as caliche mining had gone down.

So it seems to me they reduced the mining activity and increased leaching of the heap leach pile inventory. That reduces costs while you suspend some of the mining.

I assume it's all to support the lowest possible costs while they try to drive Cosayach out of business.

The above tends to suggest the $22 per kg opex claimed isn't quite what it seems as 17% of the iodine production at NV was down to heap leach only (pouring water on them) and didn't include mining costs for that portion of the production.

Took my time but I think I've got there in the end.

[bobsworth] 25/6/2015 22:24

Yes congrats from me too. I remember the day I went with my wife for her scan and told it was twins. Best day of my life and has been worth every penny since!

[cyberbub] 25/6/2015 21:56

Congrats Bogg1e, all the best.

[roundup] 25/6/2015 21:00

Somebody must be soaking up all these sells.

[bogg1e] 25/6/2015 17:46

Thanks chaps!

[che7win] 25/6/2015 13:42

Congratulations Boggle.

[woodpeckers] 25/6/2015 13:36

Hear, hear! Exciting times, Boggle, remember them well. :-)

[uppompeii] 25/6/2015 13:17

And Bogg1e in one post reminds us how unimportant all this really is!

Enjoy the baby scan, I hope all is progressing well.

[bogg1e] 25/6/2015 12:34

Che thanks. I may call them later if I get the chance (were off to hospital to get a baby scan) but if I get the chance I shall raise the issue.

[superg1] 25/6/2015 11:41

Roger

I think there is more to come yet.

Rewind a week or so ago and I mentioned some pain on the way and for those who short to consider the option re SQM.

The water rights iodine situation is a left field news that analysts were oblivious too. One main analyst thought SQM were on 12,500 mt of iodine production. They have put out a note since the Corfo news but are oblivious to the water issue at Tarapaca. They should start to catch on in the next week or so.

They do read the indmin updates, and there is more to come on there I suspect.

[bogg1e] 25/6/2015 11:07

chaps the email I sent to Lance yesterday has bounced back, stating I cannot connect to their smtp server. I used the [e-mail] address. Is there another address I can use to reach Lance directly?

Thanks

[meb123] 25/6/2015 11:07

Maybe not today though as it has tanked again after a positive start

[rogerbridge] 25/6/2015 09:51

A few analysts covering SQM will have some explaning to do. Let's hope it is better times ahead for IOF.

[freshvoicem] 25/6/2015 09:46

Interesting that theclinic has nothing on Cosayach since last November but three articles today on SQM. One lists another set of politicians alleged to be involved.

[freshvoicem] 25/6/2015 09:38

SQM CEO has admitted 11m$ (U.S.) mispayments and offered to pay tax etc on that.

[ansana] 25/6/2015 08:34

"Everything comes to she who waits" or is that he who waits?

Waiting, in IOF case it's higher iodine prices for Coss its fines and SQM its leases and water. The train has left the station and is hurtling towards SQM head office, evasive action is required. Well that's the problem of course, being evasive has got SQM into this mess. Poor SQM.

[superg1] 25/6/2015 08:31

RB energy

From the AGM comments. It seems the end is only just nigh at the iodine mine as the court order about employees to be laid off immediately was about the lithium mine only.

However the iodine mine is screwed, due to the fact Clark (Ceo) and co took up front payment for lithium from the off-take partner.

They secured the up front payments against the iodine

So in short the iodine inventory RB had, is owned by the Chinese company that wanted lithium. I assume they will sell the iodine to the Chinese end users that RB supply. 60% of RB iodine was sold to China last year meaning about 960mt.

The inventory at the time of RB going bust was about 300 to 400mt.

So RB were trying to sell the iodine mine inflating value claims, when unmentioned debts were secured against it.

[superg1] 25/6/2015 08:10

Oh BTW

I haven't seen it in posts from the AGM but it was said last week.

IOF iodine is of a purity and quality over and above anything Chile can provide. For some end users and uses, Chile iodine is not suitable.

Something to do with a quality standard IOF met but Chile folks haven't.

Also it's forecast they will get $2 mill profit from Lampricide this year

[superg1] 25/6/2015 08:06

For those that may not have read previous posts.

Tarapaca is where the Nueve Victoria iodine mine is. In that area they rely on an aquifer where the rights are under threat as in recent Chile news.

SQM list this particular water rights threat in their annual reports under risks.

For the last 3 years they have produced about 6000mt at the location.

After a bit of work I estimate that 11000mt of iodine is produced by use of fresh water in that area. (Cosayach, Bullmine, ACF Minera and SQM).

Algorta Norte are not in that area and use seawater.

RB now bust are not in that area.

SQM's Pedro de V mine is not in that area and relies on water from the Loa and San salavador rivers. PV operations are maxed out at 3,200mt.

If SQM get hit they could open up the more expensive opex El Toco mine again, but that has a capacity of 1700mt, way short of NV operations.

SQM wanted to exit the NV area in 2014 but the $665 mill move was suspended due to the potash price crash.

[captain_kurt] 25/6/2015 07:56

Really good news for iodine prices to bounce sharply from here.

[superg1] 25/6/2015 07:51

Bogg1e

The Cosayach family mid June event is the conclusion of the slavery case.

A Cosayach boss and the lawyer were facing the pain re that, I'll see what I can find as the decision, sentencing, and compensation must be due soon.

The Cosayach head would have been prosecuted but he is very ill, in a coma, and unlikely to recover. His son is the new boss, but he is in trouble too on other matters.

The US $82 mill tax fraud side of things is said to be seeing some action over the summer. In April the authorities said 'over the next few months'

Re the indmin article, I can hear a few analysts now looking at that and muttering FFS. Wait until they realise just how much of the SQM iodine business it affects,