Gold has traded between $1,262 and $1,274 so far today…as of 11:20 am Pacific, bullion is up slightly at $1,269…Silver is down 4 cents to $16.64…Copper is unchanged at $2.86…Nickel has added 2 pennies to $4.67…Crude Oil is up 25 cents a barrel to $49.41 while the beleaguered U.S. Dollar Index has fallen another one-quarter of a point to 92.76…
Nickel has really taken off in the last few weeks, hitting a 4-month high today…prices are up nearly 20% since late June, a bullish backdrop for the most exciting Nickel play in Canada in at least a decade in the heart of the prolific Eskay Camp (more in this morning’s report)…
The modest miss in today’s U.S. private sector employment is not expected to have much impact on employment expectations ahead of Friday’s non-farm payrolls report…the ADP numbers have never been a consistent indicator of the official data from the Labor Department…currently, consensus forecasts are expecting Friday’s report to show that 181,000 jobs were created in July…much focus, however, will be on wages as this has been a drag on inflation expectations…there has been minimal wage growth over the last 18 months…
CNBC reported this morning that the Trump administration is preparing a broad move against China over trade, amid growing concerns in the United States over a Chinese government-led effort to make the country a global leader in crucial technologies of the future…China’s policy to become a leading manufacturer by 2025 in the fields of driverless cars, medical devices, semiconductors, artificial intelligence, robotics and many other technologies has caught the attention of Trump administration officials…the policy, known as Made in China 2025, sets goals for China to be a global leader in 10 fields of industry with the help of massive infusions of state money and the protection of those industries from American competitors…the Chinese government has demanded that American companies cut the licensing fees that they charge for key patents, and has insisted that companies set up joint ventures to do business in China…
So-called “progressives” in North America think the biggest threat we face is “climate change”?…they need to wake up…
Tanzania Declares War Against Mining Sector
Inflammatory rhetoric and legislative changes in Tanzania have rattled the mining sector in that country with some companies ceasing or scaling back operations including Australian Gold and Lithium miner Liontown Resources…it has pulled all of its staff out of Tanzania, while Russia’s Rosatom State Atomic Energy Corp. has paused its $1.2 billion Uranium project…
International miners who once flocked to Tanzania for its low taxes and friendly laws are running up against a greedy, foolish government eager to gain a greater share of mining revenue…history repeats itself all over the world…
Since his election 2 years ago, President John Magufuli, nicknamed “the bulldozer” for his forceful leadership style, has taken a series of actions he says are aimed at redistributing mining revenue to Tanzanians…the moves range from compelling miners to list their stakes in local stock exchanges and demanding higher taxes and royalties to threatening to tear up entire extraction contracts…
“I will not hesitate to close down all the mines if companies don’t pay what they owe us,” Magufuli told a cheering crowd in Tanzania’s northwestern mining region last week. “I have launched an economic war.”
The East African nation dismantled its socialist economic controls in the 1990’s…now the 4th largest Gold producer in Africa, Tanzania also has reserves of Copper, Nickel, Uranium and Natural gas…Tanzania aims to double mining contribution to its GDP to 10% by 2025…the government says the changes are necessary to stimulate processing of commodities within Tanzania, collect more revenues and create more jobs…
Good luck, Mr. Magufuli…
Gold Seasonality Chart
As we mentioned yesterday in 7 @ 7:00, August has traditionally been a very positive month for Gold – one of the best months on the calendar in terms of total average returns over the past 2 decades (1.5% vs. 2.9% for January, 2.5% for September and 1.7% for November)…
The Gold price has increased in August nearly two-thirds of the time going back to 1998…
Crude Oil Update
Oil prices firmed this morning after investors digested a report from the Energy Information Administration (EIA) that U.S. commercial Crude inventories fell by 1.5 million barrels to a total of 481.9 million barrels in the week through July 28…that was a smaller drop than analysts were expecting, but it was nonetheless much better than yesterday’s weekly private report from API that showed an increase in Crude stocks…
Significantly, WTI has broken out of its downsloping channel pattern since the spring, pushing beyond strong resistance at $48 a barrel…next obvious target is $51.50…
CRB Index: Big 2nd Half 2017 Move Unfolding?
How the CRB Index performs over the final 5 months of the year will depend largely on the behavior of Crude Oil which makes up the most significant single component of the Thomson/Reuters Core Commodity Index…
What’s particularly noteworthy about this 3-year weekly chart is the RSI(14) breakout above a downtrend line in place for all of 2017 until last month…this encouraging action in the RSI(14) leads us to believe the CRB has an excellent chance of conquering key resistance (Fib.) at 195, perhaps by the end of this quarter…
The CRB is up 1 point at 182 as of 11:20 am Pacific…
In today’s Morning Musings…
1. BMR subscriber exclusive: Nickel Mountain Discovery Checklist – 16 compelling reasons to expect…
2. Triumph at Tatogga – GT Gold (GTT, TSX-V) update…
3. Daniel’s Den – meet the Veryx C70 Digital Sorter (can make you a fortune!)…
Did you know that for as little as just over $2 a day, you can be a BMR subscriber and tap into the best analysis and picks for the junior resource sector that you’ll find anywhere? You’ll benefit immediately from our unparalleled research and boots-on-the-ground coverage that allows us to make discovery calls that could make you fortunes.
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Wow…GGI just continues to power higher. It sure is showing strength when it dips down during the day and then powers above its high for a close.
Comment by Weatheritout80 — August 2, 2017 @ 1:07 pm
I thought you were off your rocker when you said GGI could hit .50 before drilling Jon… we’re almost there. Good call!!!
Comment by Weatheritout80 — August 2, 2017 @ 4:06 pm
Subscriber alert coming out tonight…pay attention, everyone!!!
Hopefully by 7:00 pm Pacific, so I can watch Hannity.
Comment by Jon - BMR — August 2, 2017 @ 4:12 pm
Yes Jon was right on when he said 40-60 cents before drilling… I’ll never doubt you again Jon, lol
Comment by Gregh — August 2, 2017 @ 6:58 pm
Mr. Renaud Adams reports
RICHMONT MINES REPORTS STRONG SECOND QUARTER FINANCIAL RESULTS DRIVEN BY SOLID OPERATIONAL AND RECORD COST PERFORMANCE FROM THE ISLAND GOLD MINE; REPORTS NET FREE CASH FLOW OF $19.2 (US$14.3) MILLION
Richmont Mines Inc. has released operating and financial results for the three and six months ended June 30, 2017, driven by solid results from the Island gold mine. The Corporation will host a conference call and webcast on Thursday, August 3, 2017, beginning at 8:30 a.m. Eastern Time (details below.) (All amounts are in Canadian dollars, unless otherwise indicated.)
Second Quarter Highlights
Company-wide production was 31,249 ounces of gold (35,040 ounces sold) for the quarter, primarily driven by solid production from the Island Gold Mine of 26,110 ounces of gold (29,534 ounces sold).
Company-wide cash costs for the quarter were $725 (US$539) per ounce, positively impacted by record low cash costs from the Island Gold Mine of $580 (US$431) per ounce.
Company-wide All-In-Sustaining Costs (“AISC”) of $957 (US$711) per ounce, positively impacted by record low AISC of $677 (US$503) per ounce from the Island Gold Mine.
The Island Gold Mine remains on-track to meet, or beat, annual production and cost guidance. Second quarter revenues of $59.3 (US$44.1) million.
Earnings of $10.5 (US$7.8) million, or $0.17 (US$0.12) per share.
Operating cash flow (before changes in non-cash working capital) was $24.9 (US$18.5) million, or $0.39 (US$0.29) per share.
Net free cash flow was $19.2 (US$14.3) million, or $0.30 (US$0.22) per share.
Cash balance at the end of the quarter increased to $95.9 (US$73.9) million, an increase of $20.7 (US$15.4) million over the first quarter;
Working capital increased to $81.4 (US$62.7) million.
The results of the Expansion Case Preliminary Economic Assessment (“PEA”) were released during the second quarter, supporting strong production growth of 22% at low industry cash costs and a robust cash flow stream over an initial eight-year Phase 1 period. The ramp-up is currently advancing and the mill is anticipated to achieve the target run rate of 1,100 tonnes per day in the latter part of 2018 once the expansion is completed. On July 27, 2017 the Corporation provided an update from its strategic exploration drilling program currently underway at the Island Gold Mine. Recent exploration drilling has intersected high-grade, wide mineralization in the down plunge extension of the main Island Gold deposit with Hole MH8-4 intersecting 19.85 g/t gold over 8.4 metres (true width and assays capped at 70 g/t gold).
“The positive results for the quarter were supported by another consecutive quarter of solid production and record low cash costs reported from our cornerstone Island Gold Mine. This strong operational and cost performance drove robust cash flow streams even during a period of accelerated investment in our strategic expansion and exploration programs at Island Gold,” stated Renaud Adams, CEO. He continued, “Company-wide, our focus remains on creating sustainable shareholder value by driving ongoing operational and cost efficiencies throughout the organization and maintaining our disciplined approach to capital allocation. Over the balance of the year, we will continue to focus on further unlocking the potential of the Island Gold Mine as we position the operation to be one of the lowest cost producers in the Americas.”
Comment by Jon - BMR — August 3, 2017 @ 5:38 am