Iofina Share Discussion Threads

[ramsey11] 09/10/2013 20:29

Beyond saving

[n3tleylucas] 09/10/2013 20:00

"So it's a good safety net"

No it isn't.

[ramsey11] 09/10/2013 19:59

Check mate

[superg1] 09/10/2013 19:57

HG

If Iof become the biggest US producer by 2015 and some of the production numbers talked about are achieved, what does this mean for world wide supply and affect on price?Is it the case that Iof are simply crushing the competition and will be able to maintain big margins or will they cause a supply glut and falling prices?


io2 to 6 should out them as the biggest US producer.

Iodine demand has been rising for many years at about 4% pa. The protection is that iodine is used in a multitude of products, from baby milk to etching computer chips. Technology is a big driver for the product.

Iodine is scarce commercially. Toyota Tsusho want a bigger section of the market and in their words, they said Chile is the only place where large commercial resources are viable.

That's where the problem lies for the market re supply. 58% comes from Chile and about 20% from Japan.

Japan is in decline in reserves after 50 years of brine extraction.

Chile struggles for water, the Atacama where the iodine is, is the driest place on earth. Power costs have risen as have wages.

Opex for Chile operators

Sirocco have quoted arrange of $34 to $38 opex per (current 1200mt)

recently I found something on Algorta showing they are on $35 plus. (current 2000mt plus)

The small scm Bullmine are said to be on $50 plus opex (600 to 1000mt range)

SQM have dominated the market for years and have been on 12000mt in the past, but are on the back foot now, due to setbacks in other sectors they are in.


So yes IOF could affect the market price and send the price down. that has happened already as Chile players increased production in the boom, but their capex to do so is high.

Another key point is the need for seawater. The Atacama is 7000 feet above sea level and 65/75km from. Pumping stations are needed, so opex goes up compared to pumping fresh water from underground locally.

So the above covers 4000mt all above $35 per kg opex.

Cosayach will be on 2000mt plus, but I don't know their opex. SQM used to be the lowest cost producer but now call themselves, one of the lowest.

IOF quote anticipated opex of $15 per kg once they are a material producer, which should be after this initial roll out.

I've been tracking Sirocco and all there problems and I'm sure if the price drops they will be history as will SCM bullmine. The demise of those should keep Algorta in the game, as they actually have some traction.

So it's a good safety net, if for whatever reason the price drops to certain levels, then production goes offline and the price bounces up.

Basically the Chile guys have been pushing on as they believed they are the only ones in the game and have the same opex and problems.

If you want to look at some Chile opex figures then Sirocco spell it out in their results.

IOF have mentioned they have 100+ sites where they can out plants and at the 200mt generic quote per plants that's 65% plus of the market.

I'm not saying they would do that, but 100 plants would cost $200m. That doesn't cover the cost that SQM need for seawater pipelines.

Even the far smaller Sirocco would need $50m for theirs.

In fact Sirocco said $34m spend this year and $15m in Q1 next. The result will be a hope for 800mt extra, however they have stopped sales and gone to 'inventory building' for H2, a strange move imo and what they said to cover that doesn't add up.

[ramsey11] 09/10/2013 19:45

Strange timing

[ramsey11] 09/10/2013 19:42

Fingers crossed

[n3tleylucas] 09/10/2013 19:41

An absolutely stunning post Highly Geared, as the so-called resident bear here I'll keep quiet...

[superg1] 09/10/2013 19:31

Plas

What do you put that down to?

What is the ppm at io2?

io3 bpd/ppm

io4 bpd/ppm

and so on.

If you are looking to sell come January, and they only have 4 running logic suggests the price will be lower than if they had 6 running.

But then if you are in long term, what difference does it make when 4 are running or 6, 8, 10 or more.

Do you know who the current supply is and why.

Do you know any buyers poised to move in.

If io2 has moved up towards 30k bpd, then it will be over 1mt per day add in io1 and it's over 400mt.

io3 is about to start contributing this month.

They said 700 (1.92mt per day rate) to 1000mt (2.74mt per day rate).

So 1.92mt per day to hit the 700 rate and io1 with io2 on the higher will mean they only need less than 1mt per day from io3 to 6 to hit the 700mt rate.

If you take out io1 and recycling that means io2 to 6 need to do .328mt each for the 700mt rate, or about .5mt each for the 1000mt mark.

Stripping out io2 at 1mt per day that leaves .16mt per day each for io3 to 6 (700mt rate) and .365mt per day each (1000mt rate).

Io1 was on .15mt per day from around 12k bpd and lower ppm than OK. The figures we have been given range from 17k bpd to 40k bpd for io3 to 6.



What is so unrealistic about that forecast. I'm no mug, those 6 plants can do far better than 700-1000mt

In early rns news they said io1 and 2 will do 200mt plus, that became 300mt plus, and now the actual will be 400mt plus.

There have been 6 opportunities over the last year for PIs to speak to the team directly, if some didn't take the chance to hear the inner workings, that is up to them.

Yes they say 6 by the year end, but I don't care if that is 6 by February as if I don't plan on selling or have a TP, what difference does it make.

At some point IOF will have a peak iodine production rate, peak water sales, maybe a farm in for Oil and other aspects, maybe not.

[highly geared] 09/10/2013 19:29

Quick questions ( have some Sipp cash coming free and been looking at IOF for a while but felt at x240 p , the price had run ahead of events..)
Iof talks about marketing its products in the H1 review. Does it go without saying that they can sell all they are producing and anticipate producing by 2016?

If Iof become the biggest US producer by 2015 and some of the production numbers talked about are achieved, what does this mean for world wide supply and affect on price?Is it the case that Iof are simply crushing the competition and will be able to maintain big margins or will they cause a supply glut and falling prices?

Is iodine a cyclical commodity that might suffer price booms/ busts a la copper/ coal etc or will foreseeable world demand/ supply mean a stable/ rising price ?

The bulletin board chat predominates around the production side without much comment on the strength of the end customer relationships/ contracts and the macro picture for supply. Comments welcomed....

[n3tleylucas] 09/10/2013 18:53

Oh come on! Has anyone got anything to say?

[monty panesar] 09/10/2013 18:39

Plasybryn,

I hear what you say but a run rate of 700-1000m t by the turn of the year looks very modest as that is the figure that I calculate can be produced by the first 4 plants.

I think most on here realise it is unlikely 5 and 6 are likely to produce any iodine of substance this year. They are almost certain to slip a week or two as that is life. Does it matter if they come on line a month later? Not to me as it is the bigger picture that is key.

Monty

[plasybryn] 09/10/2013 18:21

If only the Mgmt had been realistic about what they could achieve. I'm sorry but it seems to me that they have failed to deliever on their promise and don't even acknowlegde it. That always annoys me. Taking P.I.'s for mugs.

The share price movement todays smacks of ill informed P.I. thinking things are going great guns. How often have we seen that only for the share price to fall back once reality strikes home.

If they get 3 plants up and running successfully by the year end that will be a success with a realistic roll out plan in place for next year.

I think too many have have fallen in love with this stock and are happy to overlook the facts.

Just a word of warning. Hope I am wrong.

[n3tleylucas] 09/10/2013 18:18

Could come in handy here then...

[superg1] 09/10/2013 18:11

Lithium iodide was a subject we covered a few weeks back. Basically it seems that in the future most lithium batteries will go that way.

The combination removes the over-heating and combustion or the current lithium batteries and doubles the charge.

In the case of electric cars they could halve the weight of batteries used. Weight is a major barrier for that.

As you can see it is already used for pacemaker batteries, directly related to the charge capability and safety profile

[n3tleylucas] 09/10/2013 18:02

Why does that make you curious?

...is it correct?

[gadolinium] 09/10/2013 17:56

Curious, I just noticed the text in Iofina's data sheet for lithium iodide is lifted verbatim from the Wikipedia entry for lithium iodide! i.e.

'Lithium iodide is used as an electrolyte for high temperature batteries. It is also used for long life batteries as required, for example, by artificial pacemakers. The solid is used as a phosphor for neutron detection'

[gadolinium] 09/10/2013 17:48

Hi test re: post 9763:
I don't think I can add anything more from my own knowledge of lithium iodide, but your suggestions on battery usage chimes with Iofina's own product data description, below:

DESCRIPTION

Lithium iodide, or LiI, is a compound of lithium and iodine. When exposed to air, it becomes yellow in color, due to the oxidation of iodide to iodine.

APPLICATIONS

Lithium iodide is used as an electrolyte for high temperature batteries. It is also used for long life batteries as required, for example, by artificial pacemakers. The solid is used as a phosphor for neutron detection.

hxxp://oldsite.iofina.com/chem_lithium_iodide.html

[bogg1e] 09/10/2013 16:17

SG cheers. Engelo, nice find.

SG agreed about QFI, as confidant as I am about QFI's future (as I am with IOF), QFI is quickly moving into overvalued territory based on current earnings/cash reserves. Interestingly vectorvest has an inherent value for IOF at 370p, whereas QFI because it is not yet commercial at about 2p. Both are sit and wait shares. I didnt get either share at the best price, but at least with IOF and QFI i can sleep at night irrelevant of what the share price does.

[n3tleylucas] 09/10/2013 16:17

Yep, it's been corrected.