ILU - Iluka Resources

[mullokintyre]

View attachment 161498
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Amd marked DOWN some more.
View attachment 161497

Everything except unit costs went up.
And not a lot to suggest things are going to slow the rout, much less change direction.
Would not buy again until I see some evidence of significant improvement.

 

[houtman]

Today's qtly review made grim reading, their notes on the Zircon outlook in part -

Ongoing global uncertainty, subdued economic activity and weakness in the China property market continue to provide headwinds to
the zircon market.
Recent monetary policy changes in China have, to date, provided limited stimulus to the real estate sector impacting the domestic
ceramic market. In general, Chinese industrial activity has also remained subdued, contributing to low buying activity in other zircon
segments.
European demand was slightly weaker during the quarter......
India was the only slightly bright point.

They also state -
While market conditions are
challenging, Iluka continues to maintain market discipline, including price stability.

so I presume they are stockpiling Zircon production, the production/sales figures also indicate stockpiling.

I don't hold, but on the watchlist for future.

 

[divs4ever]

Today's qtly review made grim reading, their notes on the Zircon outlook in part -

Ongoing global uncertainty, subdued economic activity and weakness in the China property market continue to provide headwinds to
the zircon market.
Recent monetary policy changes in China have, to date, provided limited stimulus to the real estate sector impacting the domestic
ceramic market. In general, Chinese industrial activity has also remained subdued, contributing to low buying activity in other zircon
segments.
European demand was slightly weaker during the quarter......
India was the only slightly bright point.

They also state -
While market conditions are
challenging, Iluka continues to maintain market discipline, including price stability.

so I presume they are stockpiling Zircon production, the production/sales figures also indicate stockpiling.

I don't hold, but on the watchlist for future.

yes India looks to best near term economy but don't ignore the rest of South-East Asia including Indonesia

but yes ILU does regularly stockpile zircon and rutile , it has gotten them out of several jams ( plant break-downs , bad weather etc etc. )

if you buy in be prepared for a bumpy ride ( but if you have good trading skills ...)

cheers

 

[finicky]

Haven't read the Quarterly yet but going by houtman's summary ILU looks an avoid and wait for better signs imo. I wouldn't want to be dependent on China as a primary customer in these times, if ever while the CCP is in charge. Certainly interested myself as my impression is that ILU has created a lot of wealth in its time for shareholders; I have particularly in mind the spin-off of the iron ore royalty 100% to shareholders on the record at the time in the form of Deterra (DRR)

I'm choosing to see the monthly chart as a double top now with one top in 2022 and the other in 2023 and the trough inbetween was broken the month before last and then confirmed last month. The target for that could be back to that multi-year consolidation range 2013-2020 - see an all data chart. The mid-point of that range being $5-$4.

DECADE MONTHLY

 

[finicky]

Edit: should have said, "the level of the trough inbetween the tops was broken last month and is being confirmed so far this month"

and Not Held

 

[Rabbithop]

I thought 5 will be gd entry for me...now may revise to 4 ...to catch a falling knife....

 

[Telamelo]

I thought 5 will be gd entry for me...now may revise to 4 ...to catch a falling knife....

"current bearish trend definitely not your friend" for now... wait on the sidelines till the tide changes

 

[So_Cynical]

I thought 5 will be gd entry for me...now may revise to 4 ...to catch a falling knife....

We dont know where the support is x deterra, i doubt its 4 but whatever, ILU has been a great in and out stock over the years.

 

[divs4ever]

We dont know where the support is x deterra, i doubt its 4 but whatever, ILU has been a great in and out stock over the years.

was distracted elsewhere today , otherwise i might have been tempted with a 6 handle

 

[TimeISmoney]

 

[divs4ever]

ILU is my tip for the December Comp.

rare earths exposure , mineral sands exposure , even has positive EPS and pays divs. and now it is my monthly tip

all good reasons why this should slide and slide , maybe even below $5 if i am lucky

( i hold ILU and currently have a small top-up order in just above $6.60 , which i am very willing to lower as much as i can )

good luck in the competition everybody

 

[barney]

ILU is my tip for the December Comp.

@divs4ever ...I normally don't look at Stocks above 10 cents, but the ILU chart (and your comments) make me a bit interested. If you are able, please feel free to add further comment on the Company.

Any good Stock in serious "chart draw down", but looking like turning, is worth some attention!

 

[divs4ever]

well despite ILU having REE assets ( allegedly ) huge future demand a relatively stable rutile/zircon business ( useful in manufacturing ) but is sliding and sliding ...

now as i understand it businesses like ILU flourish as manufacturing activity rises , titanium in the heavy duty paint , heavy grinding etc etc

and this mining super-cycle has to end sometime giving miners time to upgrade and repair the heavy machinery

AND ILU has been a volatile beast in the past there is some chance i can average-down and turn this into a double or triple bagger ( that throws out irregular dividends

but how low can it go , the US is downplaying it's need for REE to make it's fancy war-toys , REEs have got to get back to 'economic to mine' don't they of Tesla will scoop them up for EVs

 

[barney]

there is some chance i can average-down and turn this into a double or triple bagger ( that throws out irregular dividends

Trading sacrilege D4!! Nobody averages down and survives, lol

It is starting to look interesting I agree. Maybe around the $6.25 area??

 

[divs4ever]

Trading sacrilege D4!! Nobody averages down and survives, lol

It is starting to look interesting I agree. Maybe around the $6.25 area??

SHSSH SHSSH !!!

don't tell MQG , BSL , BPT or CLV they don\t know any better

had an order in for around $6.50 but cancelled it today as i am travelling

am quite willing to put in an order lower if there looks to be momentum later in the week

BTW i don't consider myself a trader , i normally don't have a set time-frame when buying , there has only been one exception in 2000 buys ( in the last 12 years )

 

[Dona Ferentes]

now around $7 .... and this is why China will hold dominant position in resource downstream .

Iluka provides the following update regarding the Eneabba Rare Earths Refinery.

• As announced on 22 June 2022, Iluka has engaged Fluor Australia (Fluor) to assist with Front End Engineering and Design for the project. FEED was expected to be completed by the end of 2023. Finalisation is now expected in Q1 2024.
• Iluka has previously noted the challenging project environment in Western Australia, which will impact expected capital costs. Iluka and Fluor continue to review value optimisation measures and operational efficiency improvements. These too will impact capital cost estimates.
• Market consensus has the capital cost range for the project between A$1.3 billion and A$1.6 billion, with an average of A$1.5 billion. FEED work undertaken to date indicates the capital cost may be up to 20% above that average.
• Preliminary FEED materials indicate commissioning of the refinery is now scheduled to take place in 2026.
• Iluka expects to provide a project update at the end of Q1 2024.

 

[houtman]

now around $7 .... and this is why China will hold dominant position in resource downstream .

Iluka provides the following update regarding the Eneabba Rare Earths Refinery.

• As announced on 22 June 2022, Iluka has engaged Fluor Australia (Fluor) to assist with Front End Engineering and Design for the project. FEED was expected to be completed by the end of 2023. Finalisation is now expected in Q1 2024.
• Iluka has previously noted the challenging project environment in Western Australia, which will impact expected capital costs. Iluka and Fluor continue to review value optimisation measures and operational efficiency improvements. These too will impact capital cost estimates.
• Market consensus has the capital cost range for the project between A$1.3 billion and A$1.6 billion, with an average of A$1.5 billion. FEED work undertaken to date indicates the capital cost may be up to 20% above that average.
• Preliminary FEED materials indicate commissioning of the refinery is now scheduled to take place in 2026.
• Iluka expects to provide a project update at the end of Q1 2024.

The dilemma of when does a falling price become an opportunity.
I’ll be interested in the next qtly’s statements regarding Zircon stockpiling and its effects on the balance sheet.

 

[barney]

The dilemma of when does a falling price become an opportunity.

Indeed @houtman .... knowing when the falling knife is getting blunt is a tough call mostly ...

I don't generally look at stocks over 10 cents, but since @divs4ever peaked my interest, lol ....

Short Sell lists may or may not mean anything, but ILU's SS list is Very interesting.

ILU short sellers since (seemingly forever) have been a fair slice of the available punters at 1.4% -1.8%

At the start of this week the previous short sellers have (apparently) cashed in.

So today we have a high range/high volume down bar at the end of a week when the short sellers were out before the week started!

And it has also just broken a resistance level to the downside! (How Mum and Dad investors might react!) .... (How Big punters are thinking??)

Looks suspiciously like the start of an accumulation period/zone? ... doesn't mean it won't go lower of course ... big punters play the long game, but I'd bet London to a brick this this is the start of a consolidation zone ... and ILU will be much higher in "x amount" of months from now. (Assuming no "out of the box" crazy world events of course!!)

Recent SS List for ILU (Very interesting, particularly the start of this week) Next week will tell a better story.

 

[Dona Ferentes]

the bets seem to align with whether Aust govt will bail out the plant or not.

from AFR.

" ...The federal government’s Export Finance Australia agreed in April 2022 to lend $1.05 billion to the refinery project as part of efforts to break China’s stranglehold on the rare earths required for defence and decarbonisation applications.
EFA’s loan came with an extra $200 million “cost overrun facility if required”.

The April 2022 announcement said the taxpayer loan contained “risk-sharing mechanisms” in case the refinery ever faced “technical, operating or market-based challenges”.

Iluka chief financial officer Adele Stratton said in August that the loan agreement with EFA did not explicitly state which party would bear the responsibility of covering a cost blowout.

“If there is any potential cost overrun, the facility is actually silent in that regard so, you know, that would be something that we’d discuss if that eventuates,” she told analysts during an earnings call on August 24.

 

[finicky]

If you think there's anything in 'fractals', Iluka has an interesting one to muse on. Let me take you back to the double top of 2011-12.
Using the grid given, rather than dollars and cents, count up from the trough to the tops = 3 levels roughly.
Now count 3 levels down from the trough. That's where it eventually went but it took 4 years.
After the initial plunging descent the stock's price staged a 1 year rally but the decline was not over.
Tranferring this analogue to today, ILU might get a rally that splutters out after a decent run and then the decline resumes towards its destination - 4 or 5 bucks. Or not - just one scenario.

Not Held

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