1/7
Whilst I am turning more and more bullish on the #BMN energy front, its important to remember that right now, 99% of income is still derived from vanadium sales into the steel sector, which is suffering somewhat right now.
Whilst I am turning more and more bullish on the #BMN energy front, its important to remember that right now, 99% of income is still derived from vanadium sales into the steel sector, which is suffering somewhat right now.
2/7
At the current H1 sales price of $24.40 per kg, I have BMN roughly breaking even in H1, prior to capital investments programmes
Once we take into account those investments, be it they are scaled back this year, I believe BMN will make a loss, which may shock one or two.
At the current H1 sales price of $24.40 per kg, I have BMN roughly breaking even in H1, prior to capital investments programmes
Once we take into account those investments, be it they are scaled back this year, I believe BMN will make a loss, which may shock one or two.
3/7
But it'll depend on where the cost of additional 559mtV in sales sit.
However, right now BMN is all about riding out the downturn in vanadium prices, whilst gearing up where feasible, with its fully integrated energy storage value chain model, ready for bigger years to come.
But it'll depend on where the cost of additional 559mtV in sales sit.
However, right now BMN is all about riding out the downturn in vanadium prices, whilst gearing up where feasible, with its fully integrated energy storage value chain model, ready for bigger years to come.
4/7
With c. $34m in cash to go at this year, they are in good stead to continue doing that.
I see this very much as a continuing preparation stage, interrupted by Covid but not fully curtailed by it.
Everybody else is in the same boat but nobody is as advanced as BMN.
With c. $34m in cash to go at this year, they are in good stead to continue doing that.
I see this very much as a continuing preparation stage, interrupted by Covid but not fully curtailed by it.
Everybody else is in the same boat but nobody is as advanced as BMN.
5/7
Whats more, no other vanadium miner can bring additional capacity (currently an additional c. 4,300mtV) online faster than BMN, should there be a sustained uplift in vanadium demand.
Low vanadium prices also means VRFBs are more cost competitive (even without the new BMN
Whats more, no other vanadium miner can bring additional capacity (currently an additional c. 4,300mtV) online faster than BMN, should there be a sustained uplift in vanadium demand.
Low vanadium prices also means VRFBs are more cost competitive (even without the new BMN
6/7
rental model). So the longer V prices remain pressured, the greater ability the VRFB industry has to break further into the energy storage contract winning arena.
I hope to bring more detailed analysis on the likes of BMN to my feed in the coming weeks because these 4 walls
rental model). So the longer V prices remain pressured, the greater ability the VRFB industry has to break further into the energy storage contract winning arena.
I hope to bring more detailed analysis on the likes of BMN to my feed in the coming weeks because these 4 walls
7/7
can sometimes be suffocating to my approach and BMN is a complicated but exciting story, despite perceived near term headwinds.
In the meantime, for me, BMN is a long term investment that has likely found its valuation bottom and so I am happy to add at these levels.
can sometimes be suffocating to my approach and BMN is a complicated but exciting story, despite perceived near term headwinds.
In the meantime, for me, BMN is a long term investment that has likely found its valuation bottom and so I am happy to add at these levels.
7A A few points to add to my earlier commentary.
Firstly, I believe #BMN has got to considered beyond its exact profitability in 2020. It is merely a time point, which does not reflect where the company is heading and so is for me not central to my investment drive.
Firstly, I believe #BMN has got to considered beyond its exact profitability in 2020. It is merely a time point, which does not reflect where the company is heading and so is for me not central to my investment drive.
7B
What's key is that BMN continue to implement the plans that allow it to extract maximum worth from the pending energy storage boom.
Firstly, even without further investment, BMN is a big vanadium producer at c. 4,300mtV capacity.
What's key is that BMN continue to implement the plans that allow it to extract maximum worth from the pending energy storage boom.
Firstly, even without further investment, BMN is a big vanadium producer at c. 4,300mtV capacity.
7C
Vanadium prices will recover and that capacity at long term ave. vanadium prices, simply is not reflected into today's valuation. So its about time. Fine.
Secondly, as slow as it feels, the electrolyte plant is financed and on the way to being built and its not priced in.
Vanadium prices will recover and that capacity at long term ave. vanadium prices, simply is not reflected into today's valuation. So its about time. Fine.
Secondly, as slow as it feels, the electrolyte plant is financed and on the way to being built and its not priced in.
7D
That electrolyte plant gives BMN, BE and its off-takers, wonderful future options.
Thirdly, BMN is guaranteed take offs for as much vanadium as it wishes, from arguably 2 of the largest 3 VRFB manufacturers in the world.
Their ability to sell their units,
That electrolyte plant gives BMN, BE and its off-takers, wonderful future options.
Thirdly, BMN is guaranteed take offs for as much vanadium as it wishes, from arguably 2 of the largest 3 VRFB manufacturers in the world.
Their ability to sell their units,
7E
hasn't even started to take off yet. Knowing this investment, I understand how significant, what we have seen to date is, so i move now on it, rather than later because later is coming.
Not priced in.
Their success and drive sits outside of BMN
hasn't even started to take off yet. Knowing this investment, I understand how significant, what we have seen to date is, so i move now on it, rather than later because later is coming.
Not priced in.
Their success and drive sits outside of BMN
7F
and outside of S.A. So the risk on demand and S.A. progress, is now more shared out.
The better these companies perform (outside of S.A), the more BMN vanadium from S.A. (the part of the business they have most control over), will be demanded
and outside of S.A. So the risk on demand and S.A. progress, is now more shared out.
The better these companies perform (outside of S.A), the more BMN vanadium from S.A. (the part of the business they have most control over), will be demanded
7G
thus placing V prices under pressure.
The more vanadium that is re-directed away from steel, the more vanadium prices are pressured because as I say, BMN is now a big fish in the vanadium tank and what they do, will eventually directly affect the market.
thus placing V prices under pressure.
The more vanadium that is re-directed away from steel, the more vanadium prices are pressured because as I say, BMN is now a big fish in the vanadium tank and what they do, will eventually directly affect the market.
7H
All of that takes time, but for me now is the time to take more of the action because more is decided, than the valuation currently reflects.
Fourthly, BMN has the ability to expedite their expansion, as soon as vanadium prices begin to demonstrate themselves on BMN cashflow.
All of that takes time, but for me now is the time to take more of the action because more is decided, than the valuation currently reflects.
Fourthly, BMN has the ability to expedite their expansion, as soon as vanadium prices begin to demonstrate themselves on BMN cashflow.
7I
That is a case of when and not if. AS I have said, vanadium prices will recover and junior miners will struggle until they do and even then, they must be sustained for juniors to get financed. The same goes for the likes of stone coal.
That is a case of when and not if. AS I have said, vanadium prices will recover and junior miners will struggle until they do and even then, they must be sustained for juniors to get financed. The same goes for the likes of stone coal.
7J
Through Vanchem BMN have their future in their own hands because its a refurbishment of an existing plant.
Phase 2 has c. max. 2 years build (i think shorter), can add another 2,000mtV and can be instigated far sooner than any new mine capacity.
So when the recovery comes,
Through Vanchem BMN have their future in their own hands because its a refurbishment of an existing plant.
Phase 2 has c. max. 2 years build (i think shorter), can add another 2,000mtV and can be instigated far sooner than any new mine capacity.
So when the recovery comes,
7K
which may well be much sooner than many think, BMN will be best placed to take advantage.
That's simply not priced in.
Focus may be on profit now but it should be on BMN's ability to drives its plans, which remains intact.
So for me its about buying and waiting.
which may well be much sooner than many think, BMN will be best placed to take advantage.
That's simply not priced in.
Focus may be on profit now but it should be on BMN's ability to drives its plans, which remains intact.
So for me its about buying and waiting.
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