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Speaker 1: Hello and welcome to The Australian's Money Puzzle podcast. I'm

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Speaker 1: James Kirby. Welcome abore everybody. Now you've no doubt seen

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Speaker 1: Donald Trump sitting beside his new friend Anthony Albanesi in

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Speaker 1: recent times. Remarkable prominence given by Trump to this critical

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Speaker 1: minerals deal with Australia at the APEC this week at

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Speaker 1: Albanesi again literally city beside Trump at the top table.

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Speaker 1: This deal is really getting a lot of attention around

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Speaker 1: the world. It's getting a lot of tension in global

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Speaker 1: markets about a sector in our mining industry which it

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Speaker 1: would seem is ripe basically for a boom, and as

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Speaker 1: Australian based investors were uniquely placed to make money basically

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Speaker 1: from this situation. The issue is, I think for our

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Speaker 1: listeners who would have been watching this is how do

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Speaker 1: you play the critical minerals boom? Well, my guest is

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Speaker 1: Josh chaiat first time on the show, but I know

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Speaker 1: Josh quite well because he contributed to the wealth section

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Speaker 1: of the Australian four years and continues to. He's a

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Speaker 1: mining stock writer. He's based in Perth, which is the

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Speaker 1: best place to be if you're a mining stock writer.

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Speaker 1: I reckon, how are you, Josh.

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Speaker 2: I'm very good. It's early and it's cold and it's wet,

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Speaker 2: which is not what you think about when you think

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Speaker 2: about Perth and Wi not at all. I'm very good.

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Speaker 1: Now for our listeners, I think you know, they would

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Speaker 1: be familiar with this. They will perhaps be familiar with

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Speaker 1: previous booms in inside the mining sector, if you like.

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Speaker 1: I mean, obviously there's times where the entire mining sector

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Speaker 1: has a run, and there's times where you have spot

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Speaker 1: situations like the Great Gas boom for instance, a gas

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Speaker 1: boom gas exploration surge of interest in stocks back around

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Speaker 1: the time just after the GFC actually when there was

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Speaker 1: very little less happening. Now on critical minerals, it's something similar,

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Speaker 1: and I want to just bring people in from the

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Speaker 1: very top. They'll know the Gena Reinhart, which is present

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Speaker 1: in the country has just put more money basically into

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Speaker 1: that sector after the Trump deal was announced, which tells us,

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Speaker 1: if nothing else, that there is the opportunity here. This

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Speaker 1: is a long term game. But can you tell us, Josh,

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Speaker 1: first of all, this thing critical minerals, like how many

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Speaker 1: are there? What should we know? What are the main minerals?

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Speaker 2: So The confusing thing is that it really depends on

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Speaker 2: which country you're in what's considered a critical mineral. So

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Speaker 2: there's the United States, the EU, Australia, Japan Career. We

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Speaker 2: all have our own interpretation of what a critical mineral is.

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Speaker 2: In Australia, historically it's been something that's essential to modern technologies,

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Speaker 2: but thinking about electric vehicles, energy, things that are considered

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Speaker 2: future facing, but also the declaration for critical minerals, it's

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Speaker 2: had to have a supply chain that's disrupted or overly

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Speaker 2: potentially disrupted, so overly concentrated in one place, and for

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Speaker 2: the most part that's China, right, So there's a lot

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Speaker 2: of these minerals that are you know, sixty seventy eighty

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Speaker 2: ninety percent, particularly on the refining side controlled by China.

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Speaker 2: In Australia, I think we've had about thirty one critical

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Speaker 2: minerals on the list, and then in America it's a

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Speaker 2: lot more, it's about fifty. But it's also like increasingly

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Speaker 2: it's become a politicized term, so it's we call things

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Speaker 2: critical minerals because we want a direct government funding towards them,

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Speaker 2: and that's got to do with you know, we put

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Speaker 2: nickel in there because the nickel price nose dived a

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Speaker 2: few years ago and the government sort of desperately tried

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Speaker 2: to save nickel production in Australia, particularly in Western Australia.

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Speaker 2: It didn't work out. They were sort of too late

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Speaker 2: to the game.

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Speaker 1: I see. So that's interesting. There's no strict definition, seems

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Speaker 1: to me from the from what I've been covering that

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Speaker 1: like basically nickel, cobots, lithium, rare earth, alumina. Would they

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Speaker 1: be the headline ones after that? Did they get kind

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Speaker 1: of marginal or is there anything I'm missing there? You

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Speaker 1: said nickel obviously for Australia. Is there anything else that

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Speaker 1: maybe people would be familiar with.

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Speaker 2: It's interesting because that political angle, you know, sometimes it

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Speaker 2: goes as far as you know, the Trump administration talking

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Speaker 2: about coal being made a critical mineral, which goes very

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Speaker 2: much to their interests. But the ones that you're hearing

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Speaker 2: about now, you know, rare earth is the biggest of

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Speaker 2: the lot, and I'm sure we'll touch on why that

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Speaker 2: is in a second. And one that's really emerged the

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Speaker 2: last couple of years, and a lot of these are

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Speaker 2: because of export controls that China is put in place,

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Speaker 2: and there's a couple. Antimony is one that the price

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Speaker 2: has gone up, particularly last year the price went up

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Speaker 2: about five times over because of export controls from China,

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Speaker 2: which is the main refiner and producer of the metal,

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Speaker 2: and gallium and germanium which it will probably get on

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Speaker 2: too as well, because they're part of that critical mineral

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Speaker 2: steal between the US and Australia and very important in semiconductors,

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Speaker 2: which is also very important in the AI investment boom

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Speaker 2: that we've seen over in the US.

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Speaker 1: So you're talking about what goes into semiconductors. The semiconductors

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Speaker 1: go into AI. AI is what's driving the entire market,

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Speaker 1: so we can see that they are critical, as you say,

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Speaker 1: a couple of things. Just to clear folks, Okay, there's

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Speaker 1: no clear definition. I mean Australia has a list of

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Speaker 1: thirty one, but it's not the same as the list

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Speaker 1: that the US has. There are all sorts of reasons

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Speaker 1: why something could be defined as critical. Supply chain disruption

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Speaker 1: is crucial, Okay, We'll just take it that there is

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Speaker 1: this group and we can define them as we like.

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Speaker 1: But it's a small group and there are companies that

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Speaker 1: run hot on it. And China is crucial here. What

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Speaker 1: happened Josh with China that suddenly made investors look hard

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Speaker 1: at this area.

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Speaker 2: So what we've seen over the last couple of years

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Speaker 2: is and this is in part been in a response

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Speaker 2: to measures that the US has taken to prevent computer

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Speaker 2: chip technology from getting it out to China because they're

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Speaker 2: really worried about China catching up or getting the ascendency

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Speaker 2: in that race. We saw the drama with Deep Seek

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Speaker 2: earlier this year when they claim that they could use

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Speaker 2: old chips and produce a better product than Open Ai,

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Speaker 2: that sort of thing, and the response from China because

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Speaker 2: they have such strong control of rares and rare so commodities.

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Speaker 2: And again when we talked about rarest, it's not one mineral,

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Speaker 2: it's actually seventeen and they're all different classifications. They're used

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Speaker 2: in different products, but China produces so many of them,

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Speaker 2: and particularly refined so much of them, and they're critical

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Speaker 2: in middle military technologies. They're used in things like drones,

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Speaker 2: things like radar sensors, anything that requires a permanent magnet,

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Speaker 2: basically even down to air conditioners and the machinery that

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Speaker 2: makes your car window go up and down. Automatically.

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Speaker 1: Okay, So one of the things. So we've got a

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Speaker 1: couple of things going here. First of all, there's certain

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Speaker 1: sometimes there's a scarcity of these minders. Sometimes there isn't

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Speaker 1: They could be critical, but they're not certainly not scarce

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Speaker 1: in Australia. The question is their production they're getting into

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Speaker 1: the system. I want to just before we talk, maybe

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Speaker 1: in a few minutes, we'll talk about ways in for

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Speaker 1: the general investor listening to the show. But a couple

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Speaker 1: of things that I wanted to put to you I've

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Speaker 1: been aching to ask you. One is the extraordinary story

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Speaker 1: of lithium. Right, so lithium was the first in this

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Speaker 1: group that got a lot of attention. It went the

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Speaker 1: price of it went up tenfold, and then it fell

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Speaker 1: ninety percent. What I wonder is whether it's a prototype,

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Speaker 1: if you like, for this wider boom. Will we have

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Speaker 1: a big run up and then will we have an

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Speaker 1: enormous crash? Because Trump, if you recall, even at that meeting, said,

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Speaker 1: and he's obviously talking to China trying to basically play

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Speaker 1: up what was going on, but he said, pretty soon

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Speaker 1: all this, all these will be worth two dollars. In

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Speaker 1: other words, the ultimate outcome of the deal and the

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Speaker 1: injection of capital by both Australian and government and US

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Speaker 1: governments into this space is to actually bring down the price. Right,

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Speaker 1: So everyone's rushing in because they think the price is

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Speaker 1: going up. So is that lithium roller coaster, if you like?

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Speaker 1: Is that likely to happen with this next wave of

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Speaker 1: the critical minerals film?

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Speaker 2: I think it's a little bit different. And in fact,

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Speaker 2: rares if you look at rares that they actually followed

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Speaker 2: a very similar trajectory to lithium and for very similar reasons.

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Speaker 2: And this is kind of what the American government and

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Speaker 2: the people that are advising them are trying to counteract.

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Speaker 2: So lithium and rare as both became really scarce. I'd

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Speaker 2: probably not say really scarce. The demand shut up hugely

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Speaker 2: because of selectric vehicle boom led by China. So rarest

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Speaker 2: particularly NDPR neodymium praiser dimium, which is the main werss

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Speaker 2: price that you might see quoted. They were massively in

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Speaker 2: demand from electric vehicles, wind turbine so feb magnets, which

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Speaker 2: is the product made with neodymium praiseodmium. They're permanent magnets

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Speaker 2: that are used in ev motors and wind turbines, So

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Speaker 2: it was a massive new source of demand outside of

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Speaker 2: your kind of consumer products which use permanent magnets, which

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Speaker 2: emerged a few years ago. So rares prices actually hit

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Speaker 2: all time highs or nDPI prices hit all time highs

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Speaker 2: around the same time that lithium got to eighty thousand

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Speaker 2: dollars a ton spot for chemicals, it's now down to

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Speaker 2: around ten thousand. Neodymium Praiseodemium went to one seventy five

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Speaker 2: dollars a kilo US, which is even more than it

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Speaker 2: was in the japan led boom in twenty eleven. Twenty

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Speaker 2: twelve it came down to around fifty dollars US a kilo.

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Speaker 2: So basically the concern is were China overproducing to the

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Speaker 2: point that it was removing the incentive, intentionally removing the

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Speaker 2: incentive for operations in other countries to emerge, which would

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Speaker 2: then challenge their dominance of the supply chain. So what

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Speaker 2: you've seen with NDPR and this is when stocks, when

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Speaker 2: the railroad stocks really started to move, was the Pentagon

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Speaker 2: in June July did a deal with a company called

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Speaker 2: MP Materials, so they own mine in America called Mountain Pass,

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Speaker 2: which at the moment loses money. And Mountain Pass is

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Speaker 2: one of only two of large rareth operations outside of

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Speaker 2: Chinese influence, and the other is Linus which has the

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Speaker 2: Mountwelp mine near Laverton in Western Australia.

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Speaker 1: And Linus courses ESX listed.

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Speaker 2: Yeah, and Linus is ACEX listed, and funnily enough, there

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Speaker 2: were talks at one point between MP and Linus about

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Speaker 2: joining forces and Gina Royn Hutt has large steaks in

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Speaker 2: both companies, so she's potentially a big player in this

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Speaker 2: new mineral sperms.

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Speaker 1: So we will warn everyone basically there is speculation in

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Speaker 1: this area and the prices can really run up and

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Speaker 1: really run down, and they've rought up of late again

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Speaker 1: because of this of fear. Basically, the China in choking

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Speaker 1: off the supply in this area created scarcity. The US

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Speaker 1: and Australia have moved to fix that. But meanwhile, of

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Speaker 1: course there is a lot of action on the share

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Speaker 1: market around that, and we'll see that. Like you know,

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Speaker 1: even after that deal, you mentioned just how volatile this

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Speaker 1: area is. Mountain, the Mountain Minerals, the US rare earth

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Speaker 1: stock that felt by twenty four percent the day after

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Speaker 1: Trump said that thing about the rarelroads will be worth

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Speaker 1: about two dollars from now. So did Linus, I mean

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Speaker 1: Linus felt fairly sharply too. So did all the other

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Speaker 1: So be warned first of all, folks that this is

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Speaker 1: a very volatile speculative area. However, the long game is

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Speaker 1: that these are the future facing metals and minerals. They

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Speaker 1: go into your iPhone, they go into semiconductors, they go

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Speaker 1: into AI, they go into electric cars, they go into

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Speaker 1: wind turbines. These are this is the industry of the future.

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Speaker 1: So it is a fascinating area. The question is how

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Speaker 1: on earth do you get started? Okay, so Gina Reinhardt

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Speaker 1: went in it's arafura. Is that right? Maybe we'll talk

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Speaker 1: about that in a moment. Andrew Forrest is in there

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Speaker 1: in big time. But these people really know mining. How

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Speaker 1: does the ordinary investor get involved? We'll be back in

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Speaker 1: a moment. Hello and welcome back to The Australian's Money

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Speaker 1: Puzzle podcast. I'm James Kirby and I'm talking to Josh Chaiat,

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Speaker 1: who is the stockhead mining correspondent based in Perth and

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Speaker 1: someone who's really across the whole critical minerals area, as

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Speaker 1: you would have gathered quite clearly from the first segment

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Speaker 1: of the show. Now, what we're all waiting for, Josh,

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Speaker 1: is how do we How does the every day investor

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Speaker 1: get in here and get started? Can I just take

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Speaker 1: you through a few ideas. First of all, what about

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Speaker 1: the big names like the BHP and Real they're conglomerates, right,

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Speaker 1: and I presume they have some of this, but I

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Speaker 1: presume they're not Rare Earth's plays really because they really

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Speaker 1: are in our companies. Is that a fair coal or

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Speaker 1: am I off target? Yeah?

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Speaker 2: I mean the sense with BHP and REO is they're

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Speaker 2: not really interested in this end of the market. It's

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Speaker 2: too speculative in the market's too small for them at

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Speaker 2: the moment. Rio Tinto went into lithium, but it looks

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Speaker 2: like under their new lead, as Simon Trot, they're really

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Speaker 2: stripping back to only the best lithium operations. Is that

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Speaker 2: they bought the iron ore and then the copper, and

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Speaker 2: really you get into b HP and Rio Tinto, you're

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Speaker 2: going in for two themes, which is iron ore and copper,

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Speaker 2: and copper is sort of the big growth angle that

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Speaker 2: BHP and rio tinto are really pushing at the moment,

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Speaker 2: which is similar themes to lithium and similar themes to

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Speaker 2: lithium and rarest but very much a commodity that while

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Speaker 2: there is a bit of concentration in South America of production,

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Speaker 2: it's really not got the risk. It's produced too many

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Speaker 2: places to be disrupted in the same way.

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Speaker 1: Okay, okay, that's very interesting, and it's also very interesting

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Speaker 1: I think folks that how Josh explained that it's not

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Speaker 1: that they're it's not that they're rare, it's that they're critical.

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Speaker 1: And by that I mean it's got as much to

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Speaker 1: do with politics and supply chains as it has to

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Speaker 1: do with the amount of them in the earth, because

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Speaker 1: as any money person will tell you, some of these

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Speaker 1: are not particularly rare at all. I mean, lithium, for instance,

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Speaker 1: is widely available across Australia. The question is it's the

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Speaker 1: dynamics of the market. Okay, I want to talk about

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Speaker 1: a couple of Let's just talk about a couple of stocks.

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Speaker 1: If you can Arafura rare earth catches my eye. Are

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Speaker 1: a fura rare earth. The reason that catches my eye

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Speaker 1: is because Gina Reinhardt has gone into a four hundred

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Speaker 1: and seventy five million fundraising in this company, which is

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Speaker 1: a specific rare earth's producer, But she did it a

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Speaker 1: week after the deal that was announced, So that tells

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Speaker 1: me that she certainly doesn't think it's overpriced, though it

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Speaker 1: may well be. Tell us about that company, Josh, can

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Speaker 1: you tell us anything about it?

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Speaker 2: Saraha is interesting because they've been around for such a

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Speaker 2: long time. They've had this project for a couple of

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Speaker 2: decades called the Olans rare Earth Project. So they're not

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Speaker 2: a producer yet. There is still a development stage company,

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Speaker 2: but they have enormous amounts of government backing. And something

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Speaker 2: that was really crucial. I didn't mention it before that

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Speaker 2: that Pentagon deal between the US Department of Defense or

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Speaker 2: Department of War if you want to use A Trump's

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Speaker 2: new terminology for it. The deal included a price floor

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Speaker 2: for nDPI that was purchased by the military for just

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Speaker 2: just remind us again what is it and DPR neodmium praiseodmium.

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Speaker 1: Oxide and why is it so important?

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Speaker 2: So it's the key light rare earth product that goes

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Speaker 2: into permanent magnets and that's used in things like evmotors,

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Speaker 2: wind turns at consumer products, military applications. So they were

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Speaker 2: going to pay one hundred and ten US dollars a kilo,

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Speaker 2: which is around double what the price was in China

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Speaker 2: at the time that deal was made. And the theory

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Speaker 2: that big investors have is that these minerals are so

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Speaker 2: strategic that for at least a few of the companies,

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Speaker 2: governments are effectively going to underwrite their cash flows so

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Speaker 2: that they're not losing money and closing operations.

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Speaker 1: Bye. So there's a price floor for them. So they

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Speaker 1: give you that security as a as an investor. Okay,

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Speaker 1: that's how did you pronounce it?

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Speaker 2: Again, I'm not sure the exact pronunciation of their aru

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Speaker 2: on the ASX so.

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Speaker 1: Another one that as we make our way sort of

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Speaker 1: through this before, we don't want to get down to

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Speaker 1: two speculative. But there are groups like South thirty two,

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Speaker 1: which is something of a sort of mini conglomerate. It

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Speaker 1: was a spinoff of Corres once upon a time from PHP.

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Speaker 1: There's a Luca well known rare earths and critical minerals minor,

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Speaker 1: and there's Linus so Linus a LUCA and South thirty

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Speaker 1: two just as an entree if you like into this area,

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Speaker 1: how do they shape up?

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Speaker 2: So South thirty two you're looking at really copper and

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Speaker 2: zinc as a sort of future growth legs, which again

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Speaker 2: future facing commodies, but not quite the same as what Rafa,

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Speaker 2: Aluca and Linas are doing. Iloka have had some struggles

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Speaker 2: of late with their mineral sands business. They've closed a

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Speaker 2: couple of operations down or idled a couple of operations WA.

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Speaker 2: But they've got a big government loan to build this refinery.

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Speaker 2: It's going to be the first rarest refinery that'll produce

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Speaker 2: rare earth oxides in Australia at any Abba, which is

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Speaker 2: near Ryalton in WA. And they're really hoping that the

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Speaker 2: rares is kind of going to diversify their business. But

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Speaker 2: potentially they are beneficiary if the Australian government does things

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Speaker 2: like puts in a price floor for materials for their

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Speaker 2: strategic reserve of these metals, which is something the alb

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Speaker 2: and Easy government has announced, and i Luka in particular

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Speaker 2: probably likely to be a focus for that because the

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Speaker 2: government's putting in a big loan already, they're putting close

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Speaker 2: to two billion dollars of money into a loan for that,

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Speaker 2: so they're incentivized to make sure that thing actually gets

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Speaker 2: off the ground.

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Speaker 1: They're being directly sponsored basically by the government.

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Speaker 2: Yes, yeah, and Arafa is in that position as well,

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Speaker 2: although they're at a much earlier stage than I Luca,

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Speaker 2: so more water to go under the bridge there.

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Speaker 1: Yeah. Yeah, so Luca is closer. Luca for it is

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Speaker 1: it explorer as such, pre production and more speculative.

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Speaker 2: And I looka has the cash flows from mineral sands

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Speaker 2: as well.

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Speaker 1: Has some production. Okay, so the other one then there's

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Speaker 1: Linus tell Us about Linus seems like a great story.

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Speaker 2: So yeah, Linus is the biggest rarest producer outside of China.

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Speaker 2: So really the kind of obvious way to if you're

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Speaker 2: just making a market play, then most investor will tell

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Speaker 2: you they're sort of the obvious stock to be involved in.

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Speaker 2: The concern that a couple of analysts have is that

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Speaker 2: people are so exuberant about rare earths now since the

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Speaker 2: critical minerals discussion started happening earlier this year, that they're

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Speaker 2: pricing in a commodity price in the stock price that's

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Speaker 2: way above what it currently is what they're currently receiving,

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Speaker 2: but a lot of strategic optionality, a lot of growth

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Speaker 2: potential within their operations, if not necessarily in the market

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Speaker 2: cap at the moment, you know, people might be waiting

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Speaker 2: for a pullback a bit in Linus, and we've seen

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Speaker 2: a little bit of that because they I don't think

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Speaker 2: they got direct support in that US Australian Critical Minerals deal.

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Speaker 2: But they're the obvious company that They've got a large mind,

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Speaker 2: one of the best deposits in the world in Wa,

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Speaker 2: and they've got refining operations which most companies don't have.

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Speaker 2: So they've got a refiner in Malaysia, they're looking at

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Speaker 2: setting up some stuff in America. They've got a midstream

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Speaker 2: plant in Wa. They were really born of Japan's desire

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Speaker 2: to get away from solely Chinese supplies. Of the Japanese

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Speaker 2: government was a big backer of them, and still a

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Speaker 2: big backer.

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Speaker 1: It goes way back, that's sort of.

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Speaker 2: It goes back to twenty eleven, twenty twelve.

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Speaker 1: Yeah, okay, very good. It's interesting that you as you see,

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Speaker 1: the issue is not the companies are fine, it's the

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Speaker 1: stuff price. It's like it's like AI itself, you know.

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Speaker 1: Next TOC seems to be a pretty good company. The

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Speaker 1: issue is the price and there and of course they're

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Speaker 1: capital demands as well, so they need close consideration. Folks.

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Speaker 1: You're not probably in the business of funds, specialist funds

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Speaker 1: or ETFs, but I expect a lot of our listeners

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Speaker 1: would say too hard, I want in my way in

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Speaker 1: might be an ETF or a specialist fund. Folks, I'm

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Speaker 1: not going to name ETFs. There are quite obvious what

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Speaker 1: they are. All you have to do is google them.

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Speaker 1: There they are. There are ETFs that specialize in critical minerals.

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Speaker 1: There are ETFs that specialize in the future of electric cars,

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Speaker 1: for instance, which is a proxy for the same thing,

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Speaker 1: so you can go in that way. Are there any funds, Josh,

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Speaker 1: that are specialists in this area that are listed that

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Speaker 1: the retail investor could access.

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Speaker 2: I'm not so certain about funds specifically. I know there's

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Speaker 2: a couple of sort of large institutional investors who've gone

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Speaker 2: pretty big into this area, and I'm not sure if

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Speaker 2: it will result instead of a retail product at some point.

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Speaker 2: The one that's been really aggressive is a Tribeca, So

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Speaker 2: they've actually taken a bunch of steaks, maybe two million,

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Speaker 2: three million dollars stakes to back a lot of very

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Speaker 2: small companies. We're talking very early stage, very speculative countries,

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Speaker 2: particularly sorry companies, particularly ones that are focused in that

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Speaker 2: American market, trying to get the tailwinds of the goodwill

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Speaker 2: from the Trump administration and the executive orders they've put

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Speaker 2: in place to increase critical minerals mining. So you're asking

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Speaker 2: a few big name investors who are trying to seems

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Speaker 2: like they're trying to sort of agglomerate stakes in very

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Speaker 2: small companies. Now, whether that becomes a retail offering at

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Speaker 2: some point, I'm not sure, but it isn't to watch.

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Speaker 1: They're laying out there a bits across the area. And

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Speaker 1: one thing I should have said, folks at the store,

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Speaker 1: when we see certain companies are ASX listed, they may

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Speaker 1: be ASX listed, but the mines or some of their

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Speaker 1: minds could be in the US of course, which adds

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Speaker 1: to their attractions. Okay, I think this is fascinating. I

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Speaker 1: think it is an area where our listeners, should they

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Speaker 1: be interested in the more speculative end of the market

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Speaker 1: or taking a and seeing it through, you could be

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Speaker 1: well rewarded by a deeper dive into this. And it's

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Speaker 1: been really good to have a deep dive with Josh

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Speaker 1: this morning. All right, we've tied it for some questions

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Speaker 1: in this area. I'll be back in a moment. Hello,

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Speaker 1: Welcome back to The Australian's Money Puzzle podcast. I'm James Kirkby.

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Speaker 1: Welcome aboard again, folks, and I'm talking to Josh Chiat

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Speaker 1: on critical Minerals, a story that ranges from the White

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Speaker 1: House to Canberra to the tiniest specky miners you've ever

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Speaker 1: heard of in your life. A great story, great theme.

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Speaker 1: Can you make money from it? Where people will make

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Speaker 1: money from it? A lot of it will be timing,

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Speaker 1: I expect, because if they have these speculative cycles, if

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Speaker 1: you're on the wrong side of them, obviously, that's the

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Speaker 1: hard part with this. A couple of questions. There's one

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Speaker 1: from Frank, very simple question that says, if uranium star,

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Speaker 1: if uranium stocks are being short at how come the

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Speaker 1: places going up uranium? Josh, completely different story as such,

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Speaker 1: just the commodity that goes into nuclear power out of

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Speaker 1: fashion for a long time, Lots of false starts about

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Speaker 1: whether it's going to have a good run up, a

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Speaker 1: fat bit of shortening at the moment, but then all

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Speaker 1: of a sudden this week, Trump there it is again

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Speaker 1: announcing a big nuclear power plant construction program in the US.

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Speaker 1: What's going on with uranium in just for Lehman's terms,

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Speaker 1: where are we on with that?

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Speaker 2: So, just on the I guess it's pretty I would

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Speaker 2: say confusing questions, A complicated question because shortening of the

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Speaker 2: stocks is not necessarily investors going we're not happy about

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Speaker 2: the uranium prize that we don't.

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Speaker 1: Okay, you say that, Can you explain why you say that?

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Speaker 2: So I think there's a bit of a bit of

431
00:24:49,200 --> 00:24:53,720
Speaker 2: concern maybe around specific operations, like it's very hard to

432
00:24:53,760 --> 00:24:57,479
Speaker 2: get a mining operation running at the you know, at

433
00:24:57,480 --> 00:24:58,280
Speaker 2: the promised rate.

434
00:24:59,200 --> 00:25:05,760
Speaker 1: You it's problems with certain companies rather than their commodity uranium.

435
00:25:05,960 --> 00:25:09,360
Speaker 2: Yeah, well, we've had some pretty high profile production issues

436
00:25:09,480 --> 00:25:15,080
Speaker 2: or super resource issues or resource revisions at Paladin and Boss,

437
00:25:15,119 --> 00:25:20,080
Speaker 2: which are the two biggest uranium produced standalone uranium producers

438
00:25:20,160 --> 00:25:24,840
Speaker 2: in the Australian market. Of BHP's technically the biggest producer,

439
00:25:24,880 --> 00:25:28,239
Speaker 2: but that's a byproduct. They don't really worry about it

440
00:25:28,280 --> 00:25:32,440
Speaker 2: too much. So yeah, that can be about that specifically,

441
00:25:32,720 --> 00:25:36,720
Speaker 2: in terms of the uranium price, we've kind of seen prices,

442
00:25:37,040 --> 00:25:39,840
Speaker 2: they're a long way up from their lows. They got

443
00:25:39,880 --> 00:25:43,480
Speaker 2: really low after Fukushima because Japan shut off its entire

444
00:25:43,920 --> 00:25:46,119
Speaker 2: reactive fleet and there was a lot of concern about

445
00:25:46,400 --> 00:25:49,280
Speaker 2: nuclear energy. People are obviously a lot more comfortable with

446
00:25:49,359 --> 00:25:51,639
Speaker 2: the long term future for nuclear now. Sur prices are

447
00:25:51,680 --> 00:25:54,440
Speaker 2: way above what they were then, but they're not quite

448
00:25:54,440 --> 00:25:59,280
Speaker 2: at the level yet to incentivize new uranium operations to

449
00:25:59,560 --> 00:26:03,200
Speaker 2: be build. And the question is how long does that

450
00:26:03,280 --> 00:26:07,560
Speaker 2: last for and when does that shortage really emerge, because

451
00:26:07,720 --> 00:26:10,000
Speaker 2: there probably will be a time when utility is that is,

452
00:26:10,200 --> 00:26:13,280
Speaker 2: power plants that need uranium, nuclear power plants, there will

453
00:26:13,280 --> 00:26:14,639
Speaker 2: be a time when they need to come into the

454
00:26:14,680 --> 00:26:18,560
Speaker 2: market and purchase in larger volumes because they generally purchase

455
00:26:18,680 --> 00:26:20,640
Speaker 2: like years and years in advance, so.

456
00:26:20,600 --> 00:26:23,879
Speaker 1: They have to be spot so much time. Yeah, yeah, okay,

457
00:26:24,080 --> 00:26:24,640
Speaker 1: we're really good.

458
00:26:24,720 --> 00:26:26,240
Speaker 2: The spot market is very small.

459
00:26:26,560 --> 00:26:29,639
Speaker 1: That's right, So I understand. So there you are, folks,

460
00:26:30,040 --> 00:26:33,080
Speaker 1: two minutes on uranium. There. One of the great ironies,

461
00:26:33,119 --> 00:26:34,919
Speaker 1: of course of it older is in Australia is a

462
00:26:34,920 --> 00:26:39,119
Speaker 1: major uranium producer that has been nuclear power, happy to

463
00:26:39,359 --> 00:26:42,040
Speaker 1: send it off around the world, but not herero.

464
00:26:41,680 --> 00:26:44,359
Speaker 2: Down uranium mining in certain states as well.

465
00:26:44,440 --> 00:26:46,760
Speaker 1: In certain states as well. That's right. You can do

466
00:26:46,800 --> 00:26:49,000
Speaker 1: it somewhere you can't do with other places. Debate for

467
00:26:49,040 --> 00:26:52,320
Speaker 1: another day. Okay, now final question. We'll see what we

468
00:26:52,359 --> 00:26:54,320
Speaker 1: can do about this. It's not so much about ve

469
00:26:54,359 --> 00:26:59,840
Speaker 1: Stark as the situation that our listener Vatsal binds them.

470
00:27:00,119 --> 00:27:03,240
Speaker 1: I was in Vatzell, says the atsa L. I have

471
00:27:03,240 --> 00:27:06,280
Speaker 1: a question on salt Lake potash. This question has been

472
00:27:06,280 --> 00:27:07,960
Speaker 1: here for a while. I have to admit, it's just

473
00:27:08,040 --> 00:27:09,840
Speaker 1: I haven't had someone on the show who could even

474
00:27:09,840 --> 00:27:12,720
Speaker 1: have a go with answering it. A company delisted from

475
00:27:12,760 --> 00:27:16,719
Speaker 1: the AX several years ago and went into administration. I

476
00:27:16,760 --> 00:27:18,800
Speaker 1: want to write the shares off and the tax returners.

477
00:27:18,840 --> 00:27:22,879
Speaker 1: The shares are worthless in my opinion. And then, don't

478
00:27:22,920 --> 00:27:25,720
Speaker 1: you know, he said or she has had all sorts

479
00:27:25,760 --> 00:27:29,200
Speaker 1: of problems trying to contact APMG, trying to figure out

480
00:27:29,200 --> 00:27:33,880
Speaker 1: from the AX in link etc. It's stuck in this limbo.

481
00:27:34,200 --> 00:27:35,879
Speaker 1: This does happen. I don't want to talk so much

482
00:27:35,880 --> 00:27:40,080
Speaker 1: about it, but small mining stocks, more often than not

483
00:27:41,240 --> 00:27:44,120
Speaker 1: being the dominant small cap type of stock in Australia,

484
00:27:44,200 --> 00:27:47,680
Speaker 1: when everything goes wrong and the company's in bits basically,

485
00:27:47,720 --> 00:27:49,840
Speaker 1: and it's gone, but it's not gone from the A SX.

486
00:27:49,840 --> 00:27:52,280
Speaker 1: So you're stuck with this stock that has a value

487
00:27:52,480 --> 00:27:55,280
Speaker 1: of no point four cents or something, though it's effectively zero.

488
00:27:55,760 --> 00:27:58,280
Speaker 1: Do you know what people can do in those situations?

489
00:27:58,680 --> 00:27:59,439
Speaker 1: Have you any idea?

490
00:28:01,840 --> 00:28:06,200
Speaker 3: Cry? It's a tough one. I mean, I've had friends

491
00:28:06,200 --> 00:28:09,880
Speaker 3: who have been in companies have gotten delisted and try

492
00:28:09,960 --> 00:28:13,960
Speaker 3: to set up they try to set up like off

493
00:28:14,040 --> 00:28:18,560
Speaker 3: bourse like share sale platforms, and generally, you know, you

494
00:28:18,600 --> 00:28:21,639
Speaker 3: wind up with no or very little liquidity.

495
00:28:22,000 --> 00:28:25,639
Speaker 2: So yeah, it is effectively worthless. I think the issue

496
00:28:25,640 --> 00:28:28,200
Speaker 2: with this specific company they were trying something very new,

497
00:28:28,400 --> 00:28:33,080
Speaker 2: and I don't think retail investors. They got money, a

498
00:28:33,080 --> 00:28:35,000
Speaker 2: lot of money from retail investor. I don't think retail

499
00:28:35,040 --> 00:28:39,840
Speaker 2: investors really understood that the degree of risk involved in

500
00:28:40,200 --> 00:28:43,480
Speaker 2: this particular company. So it is always if you're going

501
00:28:43,480 --> 00:28:46,040
Speaker 2: into something in a company that's trying a very new

502
00:28:46,080 --> 00:28:51,200
Speaker 2: technique out, it's worth just being mindful of that. I

503
00:28:51,240 --> 00:28:52,840
Speaker 2: was looking at the ass when you sent this question,

504
00:28:52,880 --> 00:28:56,000
Speaker 2: so I was looking at the asset guidance, and there

505
00:28:56,040 --> 00:28:59,040
Speaker 2: can be a declaration mate that shareholders are unlikely to

506
00:28:59,120 --> 00:29:02,920
Speaker 2: get anything out of a administration process, which then can

507
00:29:03,000 --> 00:29:06,360
Speaker 2: be the trigger for that for saying that your shares,

508
00:29:06,600 --> 00:29:07,320
Speaker 2: we're getting.

509
00:29:07,080 --> 00:29:09,480
Speaker 1: Your tax right off. But who makes the declaration.

510
00:29:09,360 --> 00:29:12,720
Speaker 2: From what I read, and this is probably one for

511
00:29:12,760 --> 00:29:15,680
Speaker 2: an accountant more specifically, which is not me. That's not

512
00:29:15,760 --> 00:29:18,720
Speaker 2: what I do, but it is supposed to be I

513
00:29:18,720 --> 00:29:21,000
Speaker 2: think either the administrator or the liquid ata. Just looking

514
00:29:21,040 --> 00:29:24,640
Speaker 2: at the asset guidance. This confusing one because there was

515
00:29:24,680 --> 00:29:28,000
Speaker 2: a deed of company arrangement, which means basically a company

516
00:29:28,040 --> 00:29:31,760
Speaker 2: came in and took the asset out of the company

517
00:29:31,800 --> 00:29:36,040
Speaker 2: as part of the administration process. But potentially you've still

518
00:29:36,040 --> 00:29:38,360
Speaker 2: got a shell that survived, which has you know, the

519
00:29:38,400 --> 00:29:39,520
Speaker 2: worthless shares.

520
00:29:39,520 --> 00:29:41,840
Speaker 1: And it's interesting because when you buy mining, you think, oh, well,

521
00:29:41,880 --> 00:29:44,000
Speaker 1: you know alike software, so you say, oh, at a

522
00:29:44,080 --> 00:29:46,600
Speaker 1: very least as a mine, at very least as you

523
00:29:46,600 --> 00:29:48,400
Speaker 1: know there's a rigs there, et cetera. But you know,

524
00:29:48,520 --> 00:29:52,920
Speaker 1: in fact, if you buy tiny miners, it's highly speculative

525
00:29:52,960 --> 00:29:56,080
Speaker 1: and you can lose everything, and that includes tiny miners

526
00:29:56,080 --> 00:29:59,160
Speaker 1: in the rare earth and critical mineral space, which I

527
00:29:59,200 --> 00:30:01,760
Speaker 1: think might be a good to keep all that in

528
00:30:01,800 --> 00:30:04,080
Speaker 1: mind and wrap up with Josh. Hey Josh, first time

529
00:30:04,120 --> 00:30:06,280
Speaker 1: on the show. Terrific to have you really good, love

530
00:30:06,280 --> 00:30:07,920
Speaker 1: to have you on again. Thanks for coming on.

531
00:30:08,080 --> 00:30:10,280
Speaker 2: Jeers, thank you very much. I really appreciate it.

532
00:30:10,400 --> 00:30:12,760
Speaker 1: I was Josh chaiat there. Who is the mining a

533
00:30:12,920 --> 00:30:17,360
Speaker 1: mining correspondent birth Perth based mining correspondent with the stock

534
00:30:18,120 --> 00:30:22,840
Speaker 1: publication Stockhead. Okay, talk to you soon. Send in the

535
00:30:22,920 --> 00:30:26,800
Speaker 1: emails the money puzzle at the Australian dot com dot au.

536
00:30:26,960 --> 00:30:30,440
Speaker 1: I do have a batch of further questions on super

537
00:30:30,480 --> 00:30:34,120
Speaker 1: and clarification which we will get to and we will

538
00:30:34,160 --> 00:30:37,360
Speaker 1: get to it with Jackie who will be on the

539
00:30:37,400 --> 00:30:41,240
Speaker 1: show next Thursday. Jackie Clark, Okay, talk to you soon.

540
00:31:00,000 --> 00:31:00,040
Speaker 1: S