Economic Outlook

Third Yukon Resource Gateway Project agreement reached

Posted by Jim Paterson

on Tuesday, 3 March 2020 11:12

The territorial government of Yukon has reached an agreement with the Ross River Dena Council to initiate a $71 MM infrastructure program designed to improve the North Canol Road and the Robert Campbell Highway. Recall Macmillan Pass development will require upgrading a ~230 km segment of the Canol Road to ‘all season’ status, for which capital costs are pegged at $105 MM (2018 PEA estimate). Important government commitment aside, it remains to be seen how much will be spent on improving the North Canol Road (versus the Robert Campbell Highway). In the meantime, our conservative model continues to assume Fireweed will finance the access road’s full upgrade requirement. Click here to read full press release.

Coronavirus Vaccine Stocks Surge

Posted by MoneyTalks Editor

on Friday, 28 February 2020 12:18

It may be the ultimate silver lining story in a week that has seen record stock market declines. The race to develop a vaccine for C0V-ID19, otherwise known as the new coronavirus, has seen a number of bio-tech firms’ share price hit the roof.

IBio (NYSE:IBIO) announced last week that it would be working on a vaccine in it’s Texas lab in conjunction with Beijing-based CC Pharming. The lab started in 2010 and was partially funded by the US Defense Department. It’s leaders were involved in developing a vaccine for MERS. The stock has soared from $0.31 to $2.49. It has traded an astonishing 400,000,000+ shares in just the last 2 days – it was trading less than 3 million shares a day for most of January.

Oral vaccine specialist Vaxart (NASDAQ:VXRT) in San Francisco has seen it’s share price double, as has nanoparticle vaccine developer Novavax (NASDAQ:NVAX) in Maryland.

Closer to home Victoria BC based ImmunoPrecise Antibodies (TSX-V:IPA) announced last week that it had launched a coronavirus vaccine and therapeutic anti-body program in both it’s Canadian and European laboratories. The stock has seen a 20% increase so far, and as a smaller entity, may be flying under the radar screen of US and international investors.

A closer look at some of the key players in the Lower Mainland’s Wet’suwet’en protests

Posted by Jordan Armstrong

on Thursday, 27 February 2020 10:43

With near-daily protests and blockades disrupting the Lower Mainland, residents are beginning to see some key faces appearing regularly on their TV screens.

While demonstrators have taken pains to reject the label of “protester,” referring to themselves instead as land defenders supporting Indigenous sovereignty, it has become apparent that behind many of the actions is a much smaller group of activists.

CLICK to watch the full report

Palladium Price on Fire

Posted by MoneyTalks Editor

on Tuesday, 25 February 2020 12:05

Palladium (Pd) prices are up 75% in the past 12 months. Do you play it, or has the train already left the station?

The Market

The automobile sector, specifically for use in catalytic convertors, annually consumes about 80% of the available palladium. And stricter global emissions regulations are increasing the usage on a per vehicle basis in big consumer markets like China and India. The increased demand has pushed the palladium market into a deficit since 2012, and 2020 looks to be another year of shortage.

If you want to participate, you can buy physical palladium or you can buy the ETF PALL. But one look at the PALL chart may cause you to remember the Great Fool Theory.

A better way may be to buy shares in a few companies that either mine or explore for the precious metal, as they offer more leverage to the gains in Pd pricing. Of course, they also carry additional risks.

David and Goliath…but Goliath needs David

The top 5 mining companies deliver 85% of the global platinum and palladium production and have, in aggregate, over US$100 billion in market capitalization:

  • Nornickel – US$55B market cap – (GMKN: MSE)
  • Anglo Platinum – US$25B market cap – (AMS: JSE)
  • Impala – US$9B market cap – (IMP:JSE)
  • Sibayne Stillwater – US$8B market cap – (SSW: JSE & SBGL: NYSE)
  • Northam – US$4B market cap – (NHM:JSE)

There is a major issue, and potential opportunity, with these companies. Around 80% of that global palladium mine production comes from countries with pretty significant political risk, i.e. South Africa 39% and Russia 40%.

Neal Froneman, CEO of Sibanye Goldone, one of South Africa’s biggest Pd miner said last month: “We don’t see growth opportunities here, so we have to think outside of South Africa”.

The South Africans have already made acquisitions in USA and Canada in the past few years in a bid to diversify away from South Africa. Sibanye Gold paid US$2.2B for Stillwater’s USA assets in May 2017 and in December 2019 Impala paid $750 million for North American Palladium’s Canadian assets.

Which means there may be an opportunity to look farther down the mining and exploration development and risk scale for potential value. Here is a list of Toronto Venture Exchange listed Platinum Group Metals (which includes Platinum and Palladium) explorers which have projects in the Americas.

  • Generation Mining (GENM: CSE & GENMF:OTCPK) – US$38M market cap
  • ValOre Metals (VO: TSX-V & KVLQF:Grey Market) – US$21M market cap
  • Group Ten Metals (PGE: TSX-V & PGEZF: OTCQB) – US$20M market cap

The key driver for these early stage players? Palladium miners are cash rich and looking to grow their production in safe countries.

Happy hunting!

Resource Maven – A Sneak Peak

Posted by Gwen Preston

on Friday, 21 February 2020 14:48

Gwen Preston, editor of the Resource Maven newsletter has been kind enough to let us share a recent subscriber-only edition. If you think the long term commodity cycle is starting to turn (as we do) her perspective on how to identify value in the mining space going forward is a must-read – plus she shares some pretty detailed stock recommendations! – Ed

CLICK HERE to read The Maven Letter