There was the next investor lunch event @ Käfer's in Munich last week. Well, almost my whole family used to work at steel factory in Kosice / Eastern Slovakia (me as well for few weeks as student 20+ years ago! I was the 'never sleeps' hot iron measurer behind the railway scale in overnight shifts in my fathers smelting furnace department ~ its right after the fresh iron comes out of the oven => hot like hell!), thus iron ore, iron + steel often have been discussed at family table. Although the factory is owned by U.S. Steel now and only my younger brother still works there, my interest for steel business is still alive, you know? Of course, I've welcomed the chance to attend the presentation (don't worry if you haven't been there, the chairman Anders Hvide repeats the most important issues in the short video @ Northland's website (news from January 26, 2011). Well, I'm too tired now and a little bit sick on top, so lets just notice few issues before ill forget them forever :-):
- iron ore exploration in Sweden + Finland
- high quality + high content iron ore (69% Fe) => high premium above average iron ore price expected
- start of production of the Swedish mine in 2013, mine life 19 years, capex repaid in 4-5 years (or sooner?)
- shipping planned via port Narvik/Norway to Europe & China
- well financed up to start of production => no additional financing and/or share dilution needed
- same investment procedure as always: lets buy few shares + apply for company's newsletter + follow the developments + decide later whether to increase the initial investment or not. BTW, my pilot buy few weeks ago at invitation in order to avoid the road show premium is still slightly positive despite the so weak general market for resource companies, that's a good sign, isn't it?
- I've bought also few shares of Carpathian gold. Why? These Euroscandic / Fortuna Capital guys who present all that resource companies in Munich believe its a fair priced opportunity, so lets give it a try as well :-). Well, there is not a single loser in my portfolio out of their recommendations i think and there are already approximately10-15 'Euroscandic' companies out there! It is fine if you have someone who pre-selects the really promising companies for you, you see? BTW, what's the story behind Carpathian gold? Very simple! Mr. Market prices only their Brazilian operations, their huge Rumanian property isn't regarded at all! What if the political/environmental/etc. issues work out well for Carpathian in Romania? That will be a many-bagger then, isn't it? Carpathian gold for Carpathian German like me? That sounds great, my dear!
Any risks out there? Yes, of course, every explorer company is somehow risky. Let's mention just the IMHO most important one: the price of iron ore from 2013 on :-)
How does my iron ore division look like now?
- Rio Tinto
- Bhp Billiton
- Cardero Resources
- Alderon Resources
- Cuervo Resources
- Sherwin Iron
- Matsa Resources
- Globex Mining
- Talon Metals
- Northland Resources ~ welcome on board, my dear iron play!
Go iron go!
Disclaimer: I'm currently long all mining companies mentioned in this Instablog.