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Sunday, April 21, 2018

It’s Easter Sunday, Resurrection Day, a day that should give everyone hope because it was on this day over 2,000 years ago when Jesus rose from the dead – the most incredible comeback and the greatest victory mankind has ever witnessed!  An irrefutable fact of history, the Resurrection is what underpins the Christian faith and makes it unique – it’s why Jesus is indeed the way, the truth and the life.  And the same Spirit who allowed Him to conquer death can dwell in each of us, if we so choose.

This is a message of hope for everyone this morning, even on a day when horrific attacks targeting Christians in Sri Lanka – including bombings at churches – killed more than 200 people.  Evil in this world is sickening but it will never win.

Easter From An Investor’s Perspective

As exciting as it is to see our favorite stocks explode to the upside, or as gut-wrenching as it is to experience significant pullbacks in the markets, as investors we should never let money or our stock portfolios control our lives or rob us of our joy.  Yes, easier said than done, but that’s one reason God has provided a Helper for each of us.

True happiness – peace and lasting joy – can’t come through being in open rebellion against God.  It can only be found by knowing and serving Him through His Son, Jesus Christ, who suffered and died on the cross at Calvary and rose from the dead 3 days later on this day (Easter Sunday).  He is risen, indeed.  This is why we celebrate Easter.  This day is not about the Easter bunny or chocolates or Easter egg hunts or enjoying a day off work.  It’s about Jesus and what He did on the cross.  He suffered and died for us, out of His love and mercy for us, and actually conquered death.  That is so powerful and should give hope to us all.  Think about it.  He also modeled the values, including humility, that He wants each of us to embrace for our own good and to help improve the lives of others around us.

Nothing is more important in our view than one’s relationship with God through Jesus.  He is the Creator of all things, including every mineral and every deposit we write about here at BMR. 

It’s the dream of anyone involved in the resource sector to be part of an exciting new discovery, and the dream of every investor to own that stock and make a fortune.  Rest assured, some of those dreams are going to come true in the exciting months ahead.  But even something as amazing as that doesn’t compare to the discovery that really matters – one’s discovery of Jesus.  True riches are found in the Savior.  He changes lives and gives everlasting life to all those who come to know Him.

He has also provided us, through His precious Word, all the guidance we need for our daily lives, including of course how we should approach the handling of money, investment matters and relationships – business and personal.  With Jesus, all things are possible as Scripture repeatedly states, not matter what challenges one is facing.

This special day is a great opportunity for each of us to put some time aside and reflect on what Easter Sunday is really all about and why we celebrate it.  And draw closer to God in the process.  Each of us is very imperfect, but as sinners we have redemption through the precious blood of Jesus.

John 20:29:  “Jesus saith unto him, Thomas, because thou hast seen me, thou hast believed: blessed are they that have not seen, and yet have believed.”

From our families to yours, have a joyous Easter Sunday.

Visit the BMR comments section throughout the day for updates and helpful information!

1. Gold has traded between $1,270 and $1,278 so far today…as of 7:00 am Pacific, bullion is up $2 an ounce at $1,275 with strong support in the $1,260’s…holdings of the world’s largest Gold-backed exchange-traded fund, SPDR Gold Trust, stood at 752.86 tonnes yesterday, a marginal increase from the previous day but still around their lowest levels in 6 months…however, overall Gold holdings in physically-backed ETFs have remained relatively consistent…Silver is up 4 cents at $14.99…base metals have pulled back modestly with Copper, Nickel and Zinc at $2.92, $5.73 and $1.30, respectively…Crude Oil has gained 8 cents to $63.84 while the Dollar Index has jumped one-third of a point to 97.30…Washington and Beijing have set a tentative timeline for the next round of talks and are aiming to conclude trade negotiations by early June, according to a Wall Street Journal report…more weak economic data out of the euro zone this morning – German flash manufacturing PMIs rebounded slightly but remained squarely in contraction territory, while manufacturing activity in France hit a 4-year low…

2. TD Securities remains optimistic regarding Gold even though the yellow metal has not been able to benefit lately from a dovish Federal Reserve.  “With many in the market dismayed and pondering what it will take to move Gold past $1,350/oz, if an uber-dovish Fed can’t do the job, we see interest growing from both the official sector and money managers in the cards,” TDS commented…“Growing risks that central banks may again need to follow a nonconventional monetary policy path, when the economy heads south, are additional fodder for the view that private-asset allocations would follow the official sector in increasing their allocations to Gold and precious metals.  For now, prices remain stuck in recent ranges”…

3. Retail sales in the U.S., which account for two-thirds of GDP, bounced back vigorously in March after a stretch of weak spending, another sign that 1st quarter growth was stronger than expected…in the largest monthly gain since September 2017, retail sales increased a seasonally adjusted 1.6% in March from a month earlier to $514.1 billion, the Commerce Department reported this morning…economists were expecting about a 1.0% jump in sales…outlays on cars and car parts, along with spending at gas stations, helped push overall spending in March…however, even after removing auto-related spending including higher gas prices from the mix, consumer spending still grew a solid 0.9% in March, higher than the 0.7% gain economists expected for this underlying measure…

4. Canopy Growth (WEED, TSX; CGC, NYSE) and Acreage Holdings (ACRG.U. CSE; ACRGE, NASDAQ) have struck a deal that grants Canopy the right to acquire 100% of the shares of Acreage, with a requirement to do so at such time as cannabis production and sale becomes federally legal in the United States (when might that be?)…Acreage shareholders enjoy some immediate benefits, however…following the approval of all shareholders as well as the Supreme Court of British Columbia, Acreage holders will receive an aggregate total payment of $300 million (U.S)…later, upon nationwide legalization of cannabis, holders of Acreage will receive 0.5818 of a common share of Canopy Growth…total consideration payable pursuant to the transaction is valued at approximately $3.4 billion (U.S.) on a fully-diluted basis, representing a premium of 41.7% over the 30-day volume weighted average price of Acreage on the CSE…“Today we announce a complex transaction with a simple objective,” stated Bruce Linton, Chairman and co-CEO of Canopy Growth…”Our right to acquire Acreage secures our entrance strategy into the United States as soon as a federally-permissible pathway exists.  By combining Acreage’s management team, licenses and assets with Canopy Growth’s intellectual property and brands, there will be tremendous value creation for both companies’ shareholders”…both stocks have responded well to the news and are up in early trading…

5. The Dow has added 63 points after the first 30 minutes of trading…in Toronto, the TSX is 32 points higher while the Venture has gained 2 points to 612…Midland Exploration (MD, TSX) has closed its private placement with BHP Billiton (BHP, NYSE) which acquired 3,444,000 Midland units at $1.70 per unit ($5,854,800)…each unit includes a full warrant exercisable at $2.05 for a period of 18 months…Midland, which now has 69 million shares outstanding, is unchanged at $1.30…the company started a 2,000-m drill program at its Mythril target in Quebec’s far north in late March to test geophysical, geochemical and geological targets over a distance of approximately 2 km…Azimut Exploration (AZM, TSX-V), also active in the area, has hit its best levels since 2016…Galway Metals (GWM, TSX-V) is up slightly after releasing encouraging fresh drill results from its Clarence Stream Gold Project in New Brunswick where it’s adding a 2nd drill rig…Aurora Cannabis (ACB, TSX) has confirmed that the public appeal process related to the German cannabis production tender has been completed, and the company’s contract with the German Federal Institute for Drugs and Medical Devices has now been finalized…the approval will allow Aurora to begin construction of a new, state-of-the art, indoor cannabis production facility in Leuna, Germany in May 2019…the company anticipates completion within 12 months of ground breaking…

6. Ero Copper (ERO, TSX) has announced a series of impressive high-grade Copper intercepts from continuing exploration in the Pilar and Vermelhos districts, both part of its Vale do Curaca Property in northeast Brazil…24 drill rigs are currently operating throughout the Curaca Valley, including 11 within the Vermelhos District and 13 within the Pilar district…3 of these drill rigs are testing high-priority regional exploration targets…within the Vermelhos district, 13 holes drilled during the period highlight both extension and expansion of the previously modelled southern extent of the mineralization within the Sombrero orebody of the Vermelhos mine…significant results include hole FVS-326 that intersected 21.4 m grading 5.5% Copper including 9.2 m grading 7.6%; hole FVS-354 that intersected 17.0 m grading 6.76% Copper including 3 m @ 17.2%; and hole FVS-364 that cut 9.4 m grading 1.7% Copper and 24.6 m grading 7.6% Copper including 7.7 m grading 16%…these holes are significant as this area of the Sombrero orebody was previously modelled as small discrete lenses at the southern edge of the orebody, rather than as a more continuous high-grade extension of the mineralization of the Sombrero orebody…when combined with results of the recently completed regional airborne geophysical survey and data compilation programs, drilling continues to demonstrate significant potential for extensions of the Vermelhos mine along a north-northeast trending structure that, to date, has been interpreted to extend over 5.5 km…

7. Bureaucrats/politicians in the way again:  Scandium International (SCY, TSX) announced this morning that it has received notice from counsel for the New South Wales Department of Planning and Environment that, due to a “procedural issue” within the department, the company’s mine lease grant pertaining to the Nyngan Scandium Project in New South Wales, previously issued in October 2017, is invalid…the department has determined that its internal procedures failed to properly and fully consider an affected landowner’s “agricultural land objection” prior to the grant of the mine lease, as specified by applicable law…Scandium believes that the viability of the project is not dependent on land related to the current objection and can proceed based exclusively on surface rights owned by the company…however, it’s currently in ongoing discussions with the affected landowner, and is also in process of filing documents that could potentially address issues central to this matter…George Putnam, CEO of Scandium, commented, “The determination by the department as to the validity of the agricultural land objection has not been made, and remains at the heart of this matter.  The company (with counsel) has provided the department with extensive comments on the objection and will press for an early, accurate and fair decision in this regard.  The company remains committed to building the Nyngan Scandium Project, regardless of the decision by the department”…

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1. Gold has traded between $1,273 and $1,280 so far today…as of 7:00 am Pacific, bullion is off $1 an ounce at $1,275 with strong support in the $1,260’s…technical-related pressure and significant Gold sales by Venezuela have been major factors behind bullion’s price drop this week…yesterday’s slide saw Gold shed all of the gains it had accrued since the start of the year as the yellow metal also dipped below its 100-day moving average (SMA)…Silver is up a penny at $14.98…a broad set of upbeat economic data from China has given base metals a lift today…Copper has climbed 3 pennies to $2.97, Nickel is 5 cents higher at $5.89 while Zinc has added a penny to $1.33…Cobalt remains above $16 a pound at 3-month highs…China’s steel industry notched a new production record in the 1st quarter, spurred by consumption in the infrastructure sector as government stimulus props up demand (bullish for Nickel)…the maker of half the world’s steel churned out 231 million tons between January and March, up almost 10% from a year earlier and the highest for any 1st quarter on record…production in March climbed 10% to 80.3 million tons, according to data from the statistics bureau, as mills ramped up operations amid a profit margin recovery and less stringent curbs on production in the country’s anti-smog crackdown…Cobalt prices remain above $16, near 3-month highs…Crude Oil has gained 9 cents to $64.14 while the Dollar Index has slipped one-tenth of a point to 96.94…

2. Making Alberta Great Again:  United Conservative leader Jason Kenney cruised to a landslide victory last night, securing about 55% of the popular vote and 70% of the seats to end 4 years of NDP rule in an election that is certain to have national implications…Kenney’s passionate victory speech was a message to all Canadians, not just Albertans:  “We Canadians have been blessed with the world’s 3rd largest Oil reserves, and an abundance of Natural Gas.  But we have been targeted by a foreign funded campaign of special interests seeking to landlock Canadian energy.  This means that we Canadians have become captive to the United States as the only market for Canada’s largest export product: our energy.  As a result, we have been selling our country’s greatest asset at fire sale prices, losing billions of dollars of value, money that could build schools and hospitals across Canada.  This giveaway of Canadian energy has caused the flight of tens of billions of dollars of investment from Alberta, and with it the loss of tens of thousands of jobs.  And we are subsidizing the U.S. economy in the process, while the investment that has fled Canada is fuelling an unprecedented oil boom south of the border.  Meanwhile, the foreign funded special interests campaigning against Canadian energy have done precisely nothing to stop the doubling of Oil production in the United States, or to reduce by one barrel energy coming from OPEC dictatorships, or Vladimir Putin’s Russia.  In other words, we’ve been had.  And in Ottawa, we have a federal government that has made this bad situation worse, killing two major coastal pipelines, including Energy East that would have helped Quebec and Atlantic Canada displace foreign Oil imports with Canadian energy!  That same federal government is imposing new laws that will make it impossible to get pipelines approved in the future.  And we have provincial governments that have tried to block our energy.  Tonight all of that changes”…

3. China has released a slew of official economic data that beat expectations, including the widely anticipated GDP figure…Beijing said its economy expanded by 6.4% year-on-year in the 1st quarter of 2019, topping the 6.3% that analysts polled by Reuters had expected…China’s economy grew by 6.4% year-on-year in the 4th quarter of last year, and 6.8% in the 1st quarter of 2018…the Asian economic giant also released other economic indicators that point to a rebound:  1) Industrial production jumped 8.5% year-on-year in March, surging past the 5.9% estimated by Reuters to register the fastest growth since July 2014;  2) Retail sales for March grew by 8.7% year-on-year, beating Reuters’ projection of 8.4%;  3) Fixed asset investment in the 1st quarter increased by 6.3% year-on-year, in line with expectations…previous stimulus now appears to be working its way through the system which should lead to continued improvement in real economic data over the coming months, giving the metals market another boost…a trade agreement with the Trump administration would add a lot of fuel to the fire…

4. The Dow is off 37 points through the first 30 minutes of trading…in Toronto, the TSX has gained 17 points while the Venture has added 1 point to 611…Venture weakness the last 2 days can be attributed to technical factors as the Index fell below support in the low 620’s…however, very strong secondary support exists at 600 where the 100-day SMA, coinciding with a Fib. level, is now starting to reverse to the upside…astute investors are buying the dip…Azimut Exploration (AZM, TSX-V) has broken out to its highest levels since 2016, touching 48 cents in early trading…on Monday, the company reported very encouraging preliminary results from a 2,234-line electromagnetic and magnetic heliborne survey covering its promising Pikwa Property in the James Bay region of Quebec, part of its recently expanded strategic alliance with SOQUEM…GoGold Resources (GGD, TSX-V) has drilled 35.5 m of 284.7 g/t Ag and 1.24 g/t Au (5.04 g/t AuEq) at is newly-acquired Los Ricos Project, confirming the results from historical RC drilling…the next phase of drilling, now underway, will be focused on following the high-grade ore shoot down dip from historical drilling…

5. White Gold (WGO, TSX) has commenced its $13 million fully financed 2019 exploration program on its extensive 439 sq. km land package in the Yukon, representing over 40% of the prolific White Gold district…a total of 17,000 m of diamond drilling and 7,500 m of RC drilling is expected this season as part of the company’s systematic data driven exploration plan backed by partners Agnico Eagle (AEM, TSX) and Kinross (K, TSX)…work has commenced on the JP Ross Property focusing on expanding the footprint of the recent Vertigo discovery and other newly identified high priority targets along the 14 km Vertigo trend…detailed soil sampling performed in 2018 has proven effective to highlight known mineralization on the Vertigo discovery and also identified several new targets on the Vertigo trend and across the JP Ross Property associated with regional scale structures, demonstrating the potential for multiple mineralized systems…

6. Cannabix Technologies (BLO, CSE) announced this morning that recent characterization work with its FAIMS THC detection device with human subjects has shown the ability to consistently discriminate unwanted ions from complex human breath background matrices, allowing for THC (delta-9 tetrahydrocannabinol) detection…specifically, recent testing with updated FAIMS cell geometries has shown the ability to consistently suppress several compounds that are commonly found in breath such as nicotine, garlic, onion, meats, ethanol, and volatile flavorants including methyl salicylate and menthol (commonly found in gum), allowing for discrimination and mobility of THC in exhaled breath…company engineers have also developed a new atmospheric pressure chemical ionization source that provides significantly improved ion control in terms of intensity, stability, and focusing…Cannabix scientists have been focusing their efforts to complete characterization of FAIMS with various possible breath and environmental contaminants and are nearing completion of this phase of development…the company then plans to initiate third-party testing and piloting of the device…Cannabix has received interest in piloting from both U.S. and Canadian law enforcement groups as well as other organizations that drug test their employees…BLO is up 8 cents at $1.48 through the first 30 minutes of trading…

7. Canopy Growth (WEED, TSX; CGC, NYSE) co-CEO Bruce Linton said yesterday that the company has increased the pace of its packaging and shipping processes and anticipates sales growth to accelerate by the final quarter of the calendar year as the number of legal retailers grows and edibles hit the market…“The final two quarters of our year, I expect to be very strong”…his bullish comments came just a day after shares of Aphria (APH, TSX) slipped by as much as 15% after its quarterly revenue and earnings fell short of estimates…Linton anticipates Canopy will generate more than $1 billion in revenue globally during its financial year, which started on April 1…however, he’s not expecting Canopy to reach profitability at that level of revenue, as it is investing in clinical trials and other initiatives to position itself for the long term…meanwhile, Canopy Growth and Canopy Rivers (RIV, TSX-V) announced 2 acquisitions yesterday…Canopy Rivers said it acquired an 18.4% interest in High Beauty while Canopy Growth announced an all-cash acquisition of Cafina…

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1. Gold has traded between $1,273 and $1,288 so far today, touching a new 3-month low as equity markets continue to push higher…as of 7:00 am Pacific, bullion is off $12 an ounce at $1,275 with strong support in the $1,260’s…holdings of SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, dropped to their lowest yesterday since early November of last year…Silver is off 4 cents at $14.90…Copper and Nickel are steady at $2.93 and $5.88, respectively, while Zinc has slipped 4 pennies to $1.32…Cobalt prices remain above $16, near 3-month highs, another indication that China is turning the corner…Crude Oil has eased off 20 cents to $63.43 while the Dollar Index is up slightly at 96.99…the rally in global equities has further to go as more money jumps back into the market, BlackRock CEO Larry Fink said this morning on CNBC’s “Squawk Box”…“We have a risk of a melt-up, not a meltdown here,” said Fink, the head of the largest asset manager in the world…“We have record amounts of money in cash. We still see outflows in retail in equities and in institutions”…China reports Q1 GDP tomorrow…the larger than expected rise in new loans and aggregate financing suggests that previous stimulus is now working its way through the system which should lead to improvement in real economic data over the coming months, giving the metals mark another boost…Albertans have a chance to take their province back today as they head to the polls in a critical election that’s expected to end 4 years of NDP rule that has led to higher taxes, deficits and debt, a landlocked Oil industry and empty offices in Calgary, with help of course from the likes of Trudeau and Horgan…

2. The Bank of Canada’s gauge of business sentiment, released yesterday, has turned negative for the first time in nearly 3 years…virtually all measures were weaker in the 1st quarter, including sales growth, spending plans and hiring intentions, with many key readings slipping below historical averages…the BOC said, “The main headwinds are a more uncertain outlook in the Western Canadian energy sector, continued weakness in housing-related activity in some regions and tangible impacts from global trade tensions”…the last time the survey was in negative territory was in the 3rd quarter of 2016…the findings strongly suggest the BOC will leave its key rate unchanged next week, and perhaps do nothing through the rest of the year…meanwhile, the Bank of Nova Scotia says the probability of a recession in Canada by next year is “small but rising”…

3. The Dow is up 59 points through the first 30 minutes of trading…investors cheered strong earnings from UnitedHealth Group (UNH, NYSE) and Johnson & Johnson (JNJ, NYSE) while Bank of America (BAC, NYSE) beat analysts’ estimates for profit as it cut expenses more than expected and posted a 25% surge in earnings at its consumer banking division…in Toronto, the TSX has gained 21 points as of 7:00 am Pacific while the Venture is flat at 618…the Canadian Marijuana Index has rebounded 11 points to 611 after landing at support yesterday…Aurora Cannabis (ACB, TSX) is acquiring the balance of Hempco (HEMP, TSX-V) that it does not already own…Aurora will pay $1.04 per Hempco share, payable in shares of Aurora, reflecting a valuation of approximately $63.4 million on a fully diluted basis…Hempco provides Aurora with low-cost, high-volume access to raw material (hemp) for the extraction of CBD…Max Resource (MXR, TSX-V) is pushing higher after just announcing high-grade Gold and Platinum in surface sampling at its Choco Project in Colombia…PyroGenesis Canada (PYR, TSX-V) was halted pre-market, pending news…Niocorp (NB, TSX) is up modestly in early trading after releasing details of a new design for its Elk Creek superalloy materials project in southeastern Nebraska, plus an updated NI-43–101 Feasibility Study…the results help to further de-risk Elk Creek for project financing…pre-tax NPV of $2.57 billion is 12% higher than in the previous FS while after-tax IRR goes from 21.7% to 25.8%…total upfront CAPEX for the project, however, has climbed to $1.14 billion, a 5.1% increase over the 2017 FS…exploration drilling by Osisko Mining (OSK, TSX) has discovered a strongly mineralized extension of the Lynx deposit at approximately 1,000 m vertical depth…DDH OSK-W-19–1857 has extended Lynx 100 m down plunge in an area outside the prior Windfall mineral resource estimate area…the new exploration hole intersected a wide zone of strong silica and sericite alteration (39 m width)…it contained sulphides with local Gold mineralization from 1,278 m to 1,317 m downhole featuring 3 separate intervals – 4.3 m @ 322 g/t Au, 2.8 m @ 13.6 g/t and 2.4 m @ 16 g/t…further step out drilling is in progress to pursue this depth extension which has seen no previous drilling…

4. First Majestic Silver (FR, TSX), which has been in an uptrend since November, announced this morning that total production in Q1 2019 reached 6.3 million Silver equivalent ounces…this consisted of 3.3 million ounces of Silver, 32,037 ounces of Gold, 2.7 million pounds of lead and 1.3 million pounds of Zinc…Keith Neumeyer, President and CEO, commented, “We had a solid start to 2019.  Pure Silver production increased 2% to 3.3 million ounces as a result of higher grades at the San Dimas and La Encantada mines.  The commissioning progress of the new La Encantada roaster improved in the month of March but remained below throughput guidance for the full quarter.  Nevertheless, La Encantada recorded a significant 60% increase in Silver production in the quarter due to higher grades and tonnes processed.  Finally, we continue to expect our investments in new innovations such as high-intensity grinding and microbubbles to begin to bear fruit in the second half of 2019 with higher recoveries and production at the Santa Elena, La Encantada and La Parrilla operations”…

5. Cannabis prices in Canada have soared since legalization with prices on the black market in some areas of the country now reportedly less than half that of licensed dispensaries…the average cost of a dried gram has rocketed since legalization last October, according to users who voluntarily entered what they paid into a Statistics Canada app., with the difference between legal and illegal prices even more dramatic…marijuana in regulated stores averages $9.99 per gram compared to less than $6.40 per gram on the black market, some 36% cheaper…“Seventy per cent of total cannabis that’s being consumed was purchased illegally, 30% was from legal sources,” said James Tebrake from Statistics Canada…

6. National Access Cannabis (META, TSX-V) reported a net loss of $5.6 million in Q2 with its retail cannabis stores generating $15.9 million in revenue and adjusted EBITDA of $1.8 million…the stock is off 7 cents at 85 cents after 30 minutes of trading…the news follows Q2 losses announced yesterday by Aphria (APH, TSX) and Organigram (OGI, TSX-V)…“With 23 stores operating in 2 provinces, 7 applications underway in B.C. and a focused strategy for Ontario, we are poised to continue growing our leading footprint at a national level, while driving solid financial performance for our shareholders,” stated CEO Mark Goliger…“I am very proud of our team’s operational execution, which has resulted in our retail cannabis operating business unit generating consistently strong revenue growth and positive Adjusted EBITDA.  Our team is focused on accretively building our national retail footprint to 40 stores by the end of calendar 2019, while maximizing the same-store sales growth and contribution of individual store locations.  As the Canadian cannabis market finds its footing, we also expect supply issues to begin to abate, which will enable us to continue offering our customers the wide selection they are used to, while optimizing our working capital and adjusted EBITDA for the benefit of shareholders”…

7. Gold play turned hemp play adds another chapter:  California Gold Mining (CGM, CSE) announced this morning that it has received a Letter of Intent (LOI) from Chicago-based industrial hemp cultivation consulting firm Delta Valley Logistics (DVL) for the purchase of the company’s entire production of feminized, high-CBD (cannabidiol) industrial hemp seeds in 2019 and 2020 from the first greenhouse projected to be built on the company’s 100%-owned Fremont Property in Mariposa County, California…specifically, the non-binding LOI makes clear DVL’s intention to purchase up to 5,000 pounds of seeds from California Gold during this period…the seeds shall be purchased at the prevailing wholesale market price at the time of harvest, less 5%…current wholesale seed value is estimated to range from $15,000 to $30,000 per pound…California Gold also says it has signed a comprehensive consulting agreement with DVL whereby DVL will conduct all operations related to the company’s industrial hemp seed cultivation project at Fremont…as part of the agreement, DVL and California Gold have mutually agreed to work with each other on an exclusive basis for the cultivation of industrial hemp seed, oil and fibre within the states of California, Oregon, Washington, Nevada and Arizona for the duration of the business relationship…

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Visit the BMR comments section throughout the day for updates and helpful information!

1. Gold has traded between $1,284 and $1,290 so far today to begin a holiday-shortened trading week…as of 7:00 am Pacific, bullion is off $6 an ounce at $1,284…Silver has slipped 9 cents to $14.86…Copper, Nickel and Zinc are all off slightly at $2.93, $5.84 and $1.36, respectively…China imported 391,000 tonnes of unwrought Copper last month, up 25.7% from the previous month and 26.5% higher than a year earlier…Cobalt prices have jumped to a nearly 3-month high of $16.42, another indication that China is turning the corner…Crude Oil has eased off 46 cents to $63.43 while the Dollar Index is flat at 96.92…retail sales on Thursday will be the highlight of the U.S. economic calendar this week…headline sales are expected to rise 1% month-on-month, according to the pundits, or increase 0.7% when excluding autos…other reports include industrial production tomorrow, the Federal Reserve’s Beige Book on Wednesday, jobless claims and the Philadelphia Fed manufacturing index Thursday and housing starts on Friday when markets are closed…Chinese banks extended 1.69 trillion yuan ($251.6 billion U.S.) in net new loans in March, compared with expectations of 1.2 trillion yuan…China reports Q1 GDP on Wednesday…

2. “Global climate change is an urgent threat to humanity” – an effective claim if a government is trying to expand its powers (including, of course, taxation) and implement a radical policy agenda (the real threat)…the “urgent” climate claim was repeated again by the Trudeau Liberals in a court filing as the federal and Ontario governments prepare to square off in the province’s top court this week over Ottawa’s controversial climate change law, part of Trudeau’s National Energy Program (2.0) or Green New Deal, in a fight that’s as much political and ideological as it is legal…at issue is the validity of the Liberals’ legislation that kicked in on April Fool’s day, ironically, and imposed a charge on gasoline and other fossil fuels as well as on industrial polluters…the law applies in those provinces that have no carbon-pricing regime of their own that meets national standards…Ontario’s Progressive Conservative government under Premier Doug Ford – supported by like-minded premiers in Manitoba, Saskatchewan and New Brunswick – has denounced the Greenhouse Gas Pollution Pricing Act as an illegal tax grab that will force up the price of gasoline and heating fuel…like Saskatchewan did recently – a decision there is pending – the Ontario government is asking its Court of Appeal to decide whether the federal law is constitutional…meanwhile, Canadians appear to be waking up to 4 years of damage inflicted on the country and its resource sector by the anti-Oil, far left Trudeau Liberals – Trudeau’s unfavorability rating has shot up well past President Trump’s, while the Liberals now trail the Conservatives by 13 points in the latest opinion poll…not surprising considering Trudeau’s daily missteps, including a gift of $12 million to profit-gushing Loblaw (L, TSX) to buy emissions-free freezer cases – all in an effort, of course, to stop this “urgent threat to humanity”…

3. American Pacific Mining (USGD, CSE) has entered into an earn-in agreement with mid-tier producer OceanaGold (OGC, TSX) with respect to USGD’s Tuscarora Property in Nevada…OceanaGold can earn up to a 75% interest in the project by spending $10 million (U.S.) in exploration over the next 4 years…Warwick Smith, CEO of American Pacific, commented:  “We are very pleased to partner with OceanaGold at Tuscarora.  The company’s management and Board of Directors extend a warm welcome to the OceanaGold team as both sides work to add value to the project and define further drill targets across the large and historic land package.  This announcement adds excitement to the project and the company as we enter a new exploration season.  OceanaGold is the perfect partner in our eyes, especially with the success they have had at Waihi in New Zealand – a similar high-grade epithermal system.  For a company of our size, this transaction is a big milestone”…Eric Saderholm, President of American Pacific, added, “A joint venture with a mid-tier producer, such as OceanaGold, adds to the merit of this high-grade, epithermal Gold project.  Nevada is the top investor-friendly jurisdiction for mining, and I look forward to working alongside the OceanaGold team as we move this Gold discovery ahead at Tuscarora”…the deal with OceanaGold suggests that American Pacific has another property its eyeing in the western United States that it would work on exclusively…USGD opened higher at 30.5 cents but investors sold into the news with the stock down 2 cents at 26 cents through the first 30 minutes of trading…uptrend support is 23–24 cents…

4. The Dow is 44 points lower after the first 30 minutes of trading…Goldman Sachs (GS, NYSE) and Citigroup (C, NYSE) both beat earnings estimates but missed on revenue…Wall Street is bracing for large U.S. companies to report a decline in quarterly profits even after raking in higher revenues, something that has not happened in more than a decade…S&P 500 companies due to report in the coming weeks face tough comparisons with last year, when the U.S. tax code overhaul helped boost profits by more than 20%…the market is forward-looking, however, and sees improving numbers later in the year…in Toronto, the TSX has lost 21 points as of 7:00 am Pacific while the Venture is 4 points lower at 621…Yamana Gold (YRI, TSX) has agreed to sell its wholly-owned Chapada mine in Brazil to Lundin Mining (LUG, TSX) for total consideration of over $1 billion…Charles Fipke’s Cantex Mine Development (CD, TSX-V) hit a new high of $4.00 in early trading ($150 million+ market cap) on news that the company is commencing its 2019 exploration program at its 100%-owned North Rackla claim block in the Yukon…3 diamond drills will be utilized on the project this year, tasked with completing a 75-hole, 17,000-m drill program on the massive sulphide zone and a 3-hole, 1,000-m program at the northern Gold area…the massive sulphide zone has so far been traced for almost 2.5 km and hosts high Silver, Lead and Zinc values…the mineralization is hosted in Proterozoic aged rocks and has elevated Manganese values similar to the Sedex style Sullivan and Mt Isa mines…Global Energy (GEMC, TSX-V) has closed an over-subscribed financing, raising gross proceeds of $813,500, to immediately advance 2 Nickel-Cobalt-Copper properties in Nevada where limited historical production featured exceptionally high grades…Adventus Zinc (ADZN, TSX-V) and Salazar Resources (SRL, TSX-V) have provided encouraging preliminary metallurgical results from composites collected from the 2018 infill drilling program at the El Domo VMS deposit in Ecuador…results from ongoing metallurgical testwork will be included in a Preliminary Economic Assessment (PEA), which will also include an updated resource estimate, to be released later this quarter…

5. Cannabis stocks are under pressure this morning after a couple of earnings reports…Aphria (APH, TSX) just announced a quarterly net loss of $108.2 million or 43 cents per share, compared to net income of $54.8 million or 22 cents per share in the prior quarter, and net income of $12.9 million or 8 cents per share for the same period last year…the decrease in net income relates to non-cash impairments of $58 million and additional non-operating losses of $30 million…the adjusted net loss was $50.2 million, or 20 cents per share, but the stock is down sharply on the news (off $1.88 per share to $8.86)…net revenue was $73.6 million, up 240% from the the prior quarter…Aphria ended the quarter with $107.5 million in cash and $27.2 million in liquid marketable securities to fund planned Canadian and international growth, but how long will that last?…Organigram Holdings (OGI, TSX-V) is also trading lower after reporting quarterly results this morning – a net loss of $6.4 million or 5 cents per share for the 2nd quarter ended February 28, vs. net income of $1.2 million in the same period last year…Q2 2019 gross revenue of $33.5 million and net revenue of $26.9 million (less excise taxes) increased exponentially from the same prior year period as Q2 2019 included the first full quarter of adult-use recreational sales…the Canadian Marijuana Index has fallen to support at the 600 level…

6. A sign of the times:  Canopy Growth (WEED, TSX) will soon join the S&P/TSX 60, making it the first cannabis company to be added to the index of Canada’s large-cap stocks…Canopy’s stock will replace Goldcorp (G, TSX)and the change will take effect before trading on Thursday…Goldcorp is set to be delisted once its merger with Newmont Mining (NEM, NYSE) is complete, and the combined company will apply for a listing on the TSX…Canopy Growth’s co-CEO Bruce Linton says its addition to the S&P/TSX 60 Index marks “another major accomplishment” for the cannabis company, based in Smiths Falls, Ontario…Canopy Growth first went public on the Venture in 2014, and graduated to the main TSX board in 2016…the company changed its stock symbol on the TSX to WEED in February 2017 and was added to the S&P/TSX composite index later that year…

7. Chemesis International (CSI, CSE) announced this morning that it has entered into a binding agreement to acquire a fully operational cannabis manufacturing facility in Arizona, establishing the company as a multi-state operator…during its operations in calendar Q1 2019, the facility earned revenues of approximately $1 million (U.S.)…the facility is 5,000 sq. feet and is a turnkey solution that comes with a team of operators in place…it currently produces finished goods products, such as hard and soft-capsules, cartridges, lotions, tinctures, and other liquid formulations…additionally, the facility focuses on producing products that are 100% Cannabidiol (CBD)…Chemesis has continued to focus on its ability to enter the CBD market by adding manufacturing capabilities in California and now in Arizona…the CBD market potential across the U.S. continues to grow and Chemesis is positioning itself to quickly gain market share in an industry that is expected to exceed $2.1 billion by 2020…the facility will leverage the 2018 U.S. Farm Bill to further capitalize on the expected increased demand for CBD…“The facility in Arizona gives Chemesis a turnkey solution that brings strong bottom line revenues and a team of operators that will help the company expand its multi-state operations,” said CEO of Chemesis, Edgar Montero…”Chemesis plans to explore expansion opportunities into additional states as the cannabis industry continues to see further validation.  The acquisition brings a team of individuals that brings a wealth of experience that we believe will allow Chemesis to gain market share”…

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