Monday 5th December 2016

Resource Clips


Posts tagged ‘rhodium’

Infographic: The world’s most valuable substances by weight

January 12th, 2016

Text by Jeff Desjardins | Graphic by BullionVault

The world’s most valuable substances by weight

In the field of economics, the laws of supply and demand state that the price of a product and its available supply to the market are interconnected. For example, if a good such as crude oil is produced in excess, the price will drop accordingly.

However, sometimes substances are nearly impossible to produce in the first place—and that means that it can be extremely difficult for the market to respond to increases in demand. The world’s most valuable substances generally fall into this category and this makes their value per gram very high.

White truffles, for instance, only grow for a couple of months of the year, almost exclusively in one part of Italy. They must be foraged by special pigs, and they seem to be worth more every year. The price per gram for white truffles is $5, which means that a pound costs close to $2,000.

Despite this, white truffles barely crack the list of the most valuable substances by weight.

Saffron, a spice that is gathered from the flower of the crocus sativus plant, is another notch higher on the list. To get one pound of dry saffron requires the harvest of 50,000 to 75,000 flowers. There’s only 300 tonnes of production each year, and that annual production is worth around $3 billion.

Higher up on the list of the world’s most valuable substances are some familiar metals. Silver does not make the list, as it is only worth around $0.50 per gram. However, many of the platinum group metals (PGMs) do make the list: platinum, palladium, rhodium and iridium all range between $16 and $27 per gram. Gold also makes the list, and it has traded for more than an ounce of platinum since early 2015. One gram of gold is worth just under $34.

At the top of the list we find a combination of extremely rare metals, radioactive isotopes and gemstones.

The radioactive element californium, first made in 1950, is the most valuable at $27 million per gram. It is one of the few transuranium elements that have practical applications, being used in microscopic amounts for metal detectors and in identifying oil and water layers in oil wells.

Diamonds are near the top of the list as well at $65,000 per gram, though like many other gemstones, the value depends on the specific crystal in question. Many industrial diamonds are relatively cheap, but the rarest and most beautiful stones can be worth millions.

Iranian beluga caviar and crème de la mer are the most expensive non-metals or non-gemstones on the list. Iranian caviar is made from the roe of beluga sturgeons found in the Caspian Sea, and it is valued at about $35 per gram. Crème de la mer was originally created by a physicist for NASA to heal his burns, but it is now sold as a face cream by Estée Lauder for $70 per gram.

Graphic by BullionVault / Posted with permission of Visual Capitalist.

Some Robert Friedland riffs

July 29th, 2015

The “miner’s miner” talks commodities, jurisdictions, markets and majors

by Greg Klein

A “miner’s miner” was how Rick Rule introduced Robert Friedland. The founder and executive chairperson of Ivanhoe Mines TSX:IVN also serves as executive chair of the Sprott-Stansberry Natural Resource Symposium in Vancouver, where he delivered the opening day’s keynote speech on July 28. That was the original plan, anyway. Instead, a relaxed-looking Friedland eschewed a script to sit back and, in response to questions posed by Rule, discuss commodities, jurisdictional risk, markets and the problem with the majors.

Friedland’s favourite metals? They’re currently copper, platinum, palladium and zinc—stuff for which he sees bright futures and, not surprisingly, the stuff he’s currently pursuing. He also likes diamonds but considers himself “an agnostic on gold.”

The “miner’s miner” talks commodities, jurisdictions, markets and majors

A community group poses on Ivanhoe’s Platreef
project, expected for 2019 production.

“Copper is the metal if you believe in human advancement,” Friedland says. “Gold is the opposite.” Meanwhile this market has either hit bottom “or it’s the end of the world.” He says he’s never seen such a severe devaluation, with stocks “priced for Armageddon.”

He’s cynical of the prognosis industry. The media report obituaries for all commodities, disregarding the bullish case that Friedland sees for some metals. JP Morgan, he points out, couldn’t predict oil’s fall. Goldman Sachs’ forecasts come from “just two guys, they don’t really know, they go to the bathroom about as often as the rest of us.”

As for his own forecasts, Friedland sees economic recovery and growth, as well as specific mining opportunities because “you can’t have economic growth without copper.” He notes recovery in Europe and describes the U.S. undergoing a “slow, gentle, lousy recovery,” but a definite recovery just the same.

He considers the collapse of Chinese equity markets to be an issue separate from the country’s underlying economy. “It’s definitely not 1929 in China,” Friedland emphasizes. Run by a powerful boss, the country’s “command economy” continues to grow. Chinese hold huge personal savings. With a currency stronger than the U.S. dollar, the country now has its own de facto reserve currency.

Even if China’s economy grows 3% to 4% a year, “it’s still an enormous disruption.”

Getting back to commodities, he argues that Saudis killed the Alberta oilsands and devastated U.S. shale “but no one can do that to copper.” Friedland dismisses some copper miners as “little old ladies waiting to die,” saying some grades fall so low that companies are “practically mining air.”

Serious debt prevents most majors from building big copper mines, Friedland contends. Yet his Oyu Tolgoi discovery, “the world’s highest-grade copper mine,” will undergo major expansion following last May’s agreement between operator Rio Tinto NYE:RIO and the Mongolian government.

The long, painful process of building Oyu Tolgoi “was like a woman giving birth to a 20-kilogram baby.” But it’s high grades, not jurisdictions, that attract Friedland. In fact he sees jurisdictional risk everywhere.

But the Democratic Republic of Congo inspires him to say, “If I were a dry cleaner I’d work there.” Just the same, a deal announced in May with the Zijin Mining Group on Ivanhoe’s Kamoa copper discovery would help “defuse” jurisdictional risk thanks to China’s “very good relations” with the DRC. Once again Friedland finds very high grades—the world’s largest undeveloped high-grade copper discovery—as well as the cost benefits of a country with cheaper currency.

Ivanhoe’s other DRC project, the past-producing Kipushi mine, boasts world-class zinc grades as well as copper. As an additive for agricultural fertilizer, zinc has “an absolutely brilliant future,” Friedland says.

More high grades in South Africa’s Bushveld complex are complemented by the “ever-depreciating rand.” Friedland expects Ivanhoe’s majority-held Platreef to begin production by 2019, making it among the world’s largest platinum-palladium mines, as well as a producer of nickel, copper, gold and rhodium.

While other South African miners struggle with very deep, highly labour-intensive operations, Platreef will be shallower and mechanized. “No one has to lift more than a pencil.”

As a self-made success, Friedland denigrates those who run some of the world’s biggest companies. Pointing to the iron ore wars, he says the big players seem committed to “destroying each other through a war of attrition”

He says the people who run major miners “are just driving the bus.” Heads of companies like Anglo American and BHP Billiton NYE:BHP don’t hold significant stock positions in their companies, he claims. While majors struggled through the adversity of the last few years, boards blamed CEOs and fired them. Their replacements, Friedland insists, are “risk-averse.”

As for the guy who first hit the big time over 20 years ago at Voisey’s Bay, “I made my own money.”

The Sprott-Stansberry Vancouver Natural Resource Symposium continues to July 31.

Precious, practical and fickle

November 13th, 2013

Platinum’s supply shortage won’t boost its near-term price, a report cautions

by Greg Klein

Forecasts that platinum prices would break free of gold have so far proved premature. True, the metal now attracts strong ETF interest in addition to industrial uses, not to mention jewelry and bullion. Demand is set to hit record levels this year, pushing supply further into deficit. But a comprehensive study of the metal’s 2013 performance finds it “increasingly unresponsive to supply-side concerns.”

Indeed, “after rising above $1,700 in February, platinum was dragged below $1,400 following a sharp fall in the gold price.” That comes from the Platinum 2013 Interim Review released November 12 by Johnson Matthey, self-described as “the world’s leading authority on platinum group metals.” The 40-page report compiled by an 11-person research team tracks the year’s PGM performance in supply, demand and price by jurisdiction and use. While the study finds considerable push and pull from other forces, the vagaries that trouble gold seem to afflict platinum too.

Yet this year’s supply deficit is forecast at 605,000 ounces, compared to 340,000 ounces in 2012, thanks to ETFs and industry. The latter includes automotive catalytic converters as well as chemical, electrical, glass, petroleum and medical/biomedical uses.

Platinum’s supply shortage won’t boost its near-term price, a report cautions

The researchers say an 11.5% increase in industrial demand will come largely from chemical uses while catalyst demand will drop. As for ETFs, “unprecedented offtake” in South Africa, along with ETFs from other regions as well as bars and coins, “will lift investment demand to a record 765,000 ounces.”

Most of that came from “pent-up demand” in SA where the new Absa Capital ETF rose to 660,000 ounces between its April launch and the end of September, Johnson Matthey points out. The rand-denominated, Johannesburg-traded product attracted institutions that face limits on foreign investments, but also anyone who could afford the 1/100th-ounce minimum purchase.

Along with supply concerns, that ETF partly offset the precious metals plunge that started in April. But by the end of September, the report indicates, platinum’s performance often mimicked gold’s rise and fall in response to speculations about the Fed, quantitative easing and the U.S. debt ceiling. The study tracks platinum’s progress to a September 27 low of $1,411. Still, that’s an improvement over $1,323 in June following the spring precious metals crash that coincided with a weakening auto sector in Europe. Platinum began November 13 at $1,436.

The anticipated breakout from gold hasn’t happened. Even so the year’s platinum mine supply forecast comes to 5.74 million ounces (up 1.6% from 2012), plus 2.07 million ounces from recycling, versus 8.42 million ounces of demand (up 4.9%). Commodity price explanations don’t come easily, especially with precious metals. And platinum is considered both precious and industrial, potentially pulled in different directions by opposite forces. Johnson Matthey attributes about 9% of 2013 demand to investment and 32% to jewelry.

Looking ahead, the report sees a third consecutive deficit next year but “this may not be sufficient to support higher platinum prices.” The predicament of South Africa, the world’s leading producer but with dwindling reserves and uncertain labour conditions, might have been expected to push platinum prices further. “But investor fatigue appears to have set in and sporadic strikes in 2013 have had increasingly little influence on the price.”

[A not-yet launched Johannesburg-traded ETF comprises] the biggest uncertainty facing the palladium market next year.—Johnson Matthey’s
Platinum 2013 Interim Review

The report sees palladium ($741 an ounce on November 13) showing a smaller but still significant 2013 deficit of 740,000 ounces. The metal’s mined for catalysts, largely for gas engines, as opposed to diesel motor catalysts that use platinum. Other key consumers are the chemical, dental and electrical industries.

The mine supply forecast shows 6.43 million ounces, down about 1.5% from last year. Recycling brings in another 2.46 million. Demand comes to 9.63 million, down 3.4%. About 7.8% of demand comes from investment and 4% from jewelry.

Both industrial and investor demand have dropped despite “significant inflows into palladium ETFs in the first two months.” But the authors note that Absa Capital has received SA regulatory approval for a Johannesburg-traded palladium ETF, a “wild card” that’s “the biggest uncertainty facing the palladium market next year.” The ETF’s launch date hasn’t been announced.

Rhodium, also used for catalysts and in the chemical, electrical and glass industries, began November 13 at $980. That’s barely above July’s nine-year low of $975, despite demand reaching a six-year high. The report attributes the contradiction to a “large hangover of surplus metal that accumulated between 2008 and 2011.” Today’s small deficits are “entirely due to the movement of market stocks into physically-backed investment products” from a Deutsche Bank rhodium ETF as well as rhodium bars sold in North America and Europe.

Prices for ruthenium and iridium, both used for electrical, chemical and (of course) electro-chemical uses, dropped sharply this year. The report attributes “a long-term imbalance between primary production and consumer offtake.”

Examining supply by jurisdiction, South Africa shows little change in platinum production, a result of depleting deposits and labour unrest. Only Zimbabwe, a country fraught with jurisdictional risk, is likely to increase its platinum output in 2014.

Russia’s platinum production will see a slight decline. Palladium too, because of reduced sales from government stockpiles, “now an insignificant part of the overall palladium supply picture.”

Nor will Canadian production see much change. Lower output from North American Palladium’s TSX:PDL Lac des Iles mine in northwestern Ontario will be offset by increased palladium byproduct from nickel operations at Glencore Xstrata’s Raglan mine in northern Quebec and Vale’s Sudbury operations, the report states.

Week in review

March 1st, 2013

A mining and exploration retrospect for February 23 to March 1, 2013

by Greg Klein

Next Page 1 | 2

Another spring fever for graphite?

As one of Chris Berry’s “energy minerals”, graphite had an energetic week with the biggest news coming from Energizer Resources TSX:EGZ. The company’s Molo graphite deposit in Madagascar reached another milestone Tuesday with its preliminary economic assessment.

But to start with Monday, Rock Tech Lithium TSXV:RCK released drill results from the Plumbago area of its Lochaber project in southern Quebec. The same day Nevado Resources TSXV:VDO did the same thing for its Fermont property in the province’s northeast.

A mining and exploration retrospect

Coinciding with Energizer’s Tuesday release, Pistol Bay Mining TSXV:PST announced an option on the Portland graphite property in southeastern Ontario. Also on Tuesday, Canada Strategic Metals TSXV:CJC released metallurgical tests from its La Loutre property back in southern Quebec.

More metallurgical news came the following day from Standard Graphite’s TSXV:SGH Mousseau East deposit, again in southern Quebec. Then on Thursday Mason Graphite TSXV:LLG weighed in with drill results from Lac Gueret in northeastern Quebec.

No graphite news on Friday, however. Presumably everyone was en route to PDAC 2013, where they’ll conspire to pump up a repeat of last spring’s graphite mania.

No wait, this is the hottest new commodity

“Rhodium, the scarcest precious metal used in making catalytic converters, is outperforming platinum and palladium for the first time in seven years as global car sales rise to a record,” stated a Thursday Bloomberg report.

“The metal, used with palladium and platinum in pollution-control devices, rose 16% this year, about three times the increase of the other two ingredients and 20 times more than the benchmark commodities index (MXWD). Output will trail demand for four more years after the first deficit since 2007 [took place] last year [and eroded] inventories, Standard Bank Plc’s SBG Securities … forecasts.”

It seems to be gaining safe haven status too. “Baird & Co., a UK precious metals dealer, sold about 10,700 one-ounce rhodium bars … more than 10 times the amount planned when production began in May 2012,” the news agency added. “The London-based company expanded with bars that weigh one-tenth an ounce to five ounces to meet increased demand.”

A Baird spokesperson told Bloomberg, “At the moment we can’t make them quick enough so we are stepping up production. The market is so thin that it just needs a car company to buy a year’s worth of production or a hedge fund to pull out a little bit of loose change. It doesn’t take a lot to create quite sharp price movements.”

De Beers blockade: Cops’ lack of resolve resolves nothing

At press time Friday, De Beers’ Victor diamond mine in northern Ontario had gone seven (7) days without an illegal native blockade. The most recent roadblock ended late February 22 when the five or six protestors simply left. Then, and only then, did police move in.

So far the company has lost nearly half of an approximately 45-day opportunity to haul a year’s worth of heavy supplies over a seasonal ice road. As a result, the mine might face a temporary shutdown, the Timmins Daily Press reported on Tuesday.

Next Page 1 | 2

South of Klondike

May 28th, 2012

Prophecy adds PGEs to its Yukon Nickel-Copper-Gold Project

By Greg Klein

Next Page 1 | 2

Long after the Gold Rush that such inspired characters as Sam McGee, Blasphemous Bill and Dangerous Dan McGrew, Yukon is again coming to international prominence as a new gold play matures. In the territory’s southwest, Prophecy Platinum Corp TSXV:NKL is developing one of the world’s largest undeveloped resources of nickel-copper-platinum group elements towards PEA and prefeasibility.

Unlike Russia and South Africa, producers of 85% of world PGE supply, Robert Service’s old stomping ground has settled into a stable, mining-friendly jurisdiction. That bodes well for Prophecy‘s Wellgreen Project and its newly found potential to host a rare PGE resource in addition to nickel, copper and gold.

Prophecy adds PGEs to its Yukon Nickel-Copper-Gold Project

The company has just released 90 additional assays from a 2011 hole which show an average 28% increase in the full spectrum of six PGEs. Results from the hole released September 26, 2011, reported nickel-copper-gold assays in addition to platinum-palladium, but didn’t include results for the other four PGEs. The September assays showed

0.29% nickel, 0.18% copper, 0.34 g/t platinum, 0.33 g/t palladium and 0.05 g/t gold over 457.4 metres
(including 0.36% nickel, 0.3% copper, 0.63 g/t platinum, 0.54 g/t palladium and 0.08 g/t gold over 120.9 metres)
(and including 1.03% nickel, 0.75% copper, 1.33 g/t platinum, 1.64 g/t palladium and 0.17 g/t gold over 17.8 metres)

The hole started 7.1 metres from surface, extending to 263.8 metres. Ninety sample assays from the same hole released May 25 included the missing PGE quartet. Highlights include

0.023 g/t osmium, 0.019 g/t iridium, 0.054 g/t ruthenium and 0.024 g/t rhodium
0.022 g/t osmium, 0.013 g/t iridium, 0.038 g/t ruthenium and 0.018 g/t rhodium
0.023 g/t osmium, 0.021 g/t iridium, 0.055 g/t ruthenium and 0.025 g/t rhodium
0.05 g/t osmium, 0.03 g/t iridium, 0.078 g/t ruthenium and 0.035 g/t rhodium
0.018 g/t osmium, 0.016 g/t iridium, 0.042 g/t ruthenium and 0.02 g/t rhodium

Rhodium, platinum and palladium are the most important of the six PGEs, with some 80% to 85% going into auto-catalyst manufacture. Prophecy cites a 1997 Geological Survey of Canada bulletin stating that only Russia’s Norilsk ores have nickel-copper cores with comparable values of rhodium. As Prophecy Head Geologist Danniel Oosterman says, “A lot of nickel-copper-PGE deposits around the world don’t have appreciable values of PGEs beyond platinum and palladium.”

Assays are pending for an additional 260 samples from the same hole. Meanwhile, drilling continues. About 30% of a 9,000-metre underground program has been completed so far, with results to come. Surface drilling will resume within the next two weeks, with 7,000 metres planned. The plan is to upgrade the July 2011 resource.

As it stands now, the indicated category shows 220 million pounds nickel, 200 million pounds copper, 15.8 million pounds cobalt, 460,000 ounces platinum, 340,000 ounces palladium and 240,000 ounces gold. The inferred category shows 2.4 billion pounds nickel, 2.2 billion pounds copper, 191.3 million pounds cobalt, 4.9 million ounces platinum, 3.9 million ounces palladium and 2.1 million ounces gold. The estimate uses a 0.4% nickel-equivalent cutoff.

Prophecy‘s timeline calls for a preliminary economic assessment for possible release as early as June and a resource update in 1Q 2013, to be followed by prefeasibility.

Next Page 1 | 2

Pacific North West reports ON Results of 1.99 g/t Pd, 0.69 g/t Pt over 27m

September 27th, 2011

Resource Clips - essential news on junior gold mining and junior silver miningPacific North West Capital Corp TSX:PFN announced results from its River Valley Property near Sudbury, Ontario. Assays include

1.99 g/t palladium, 0.69 g/t platinum, 0.12 g/t gold, 0.01 g/t rhodium, 0.02% nickel and 0.12% copper over 27 metres (including 2.57 g/t palladium, 0.91 g/t platinum, 0.14 g/t gold, 0.01 g/t rhodium, 0.04% nickel and 0.2% copper over 12 metres)
3.2 g/t palladium, 0.99 g/t platinum, 0.13 g/t gold, 0.01 g/t rhodium, 0.02% nickel and 0.16% copper over 9 metres (including 5.44 g/t palladium, 1.58 g/t platinum, 0.19 g/t gold, 0.02 g/t rhodium, 0.04% nickel and 0.27% copper over 4 metres)
1.56 g/t palladium, 0.5 g/t platinum, 0.09 g/t gold, 0.01 g/t rhodium, 0.03% nickel and 0.13% copper over 19 metres (including 2.5 g/t palladium, 0.79 g/t platinum, 0.14 g/t gold, 0.01 g/t rhodium, 0.04% nickel and 0.19% copper over 5 metres)

The project has a measured resource estimate of 7.99 million tonnes containing 342,000 ounces palladium, 112,400 ounces platinum and 19,600 ounces gold, an indicated resource of 11.31 million tonnes containing 391,100 ounces palladium, 132,600 ounces platinum and 24,000 ounces gold and an inferred resource of 0.88 million tones containing 38,400 ounces palladium, 13,100 ounces platinum and 2,100 ounces gold.

View Company Profile

Contact:
Pacific North West Capital Corp
604.685.1870

by Greg Klein